MILAN (Thomson Financial) - Citigroup has no talks underway to settle
Parmalat SpA's civil U.S. court claim, nor to plea-bargain criminal
investigations underway in the Italian cities of Milan and Parma, said sources
close to Citigroup.
Analysts have speculated that Parmalat and Citi could reach a settlement
during a civil trial in New Jersey, which started this week, in which Parmalat
is claiming $2.2 billion from Citigroup.
"At this moment, there is no type of talks underway," said the source.
In the civil case, Parmalat is alleging that Citigroup contributed to the
failure of the dairy group in December 2003, a claim which Citigroup rejects.
Parmalat relisted in October 2005 after a financial restructuring.
The New Jersey court is currently selecting a jury ahead of trial hearings
on the evidence expected to start next week, with judgement expected by the
middle of July, the Citigroup sources said.
Parmalat originally claimed $33 billion from Citigroup, including punitive
damages, over Parmalat's collapse with 14 billion euros of debts, though the
claim has been scaled down to $2.2 billion.
Citigroup is counterclaiming for $699 million for losses it says it suffered
because of Parmalat's collapse, the Citigroup sources said.
Citigroup argues that contracts for securitisation of Parmalat receivables,
a stake in a Parmalat Canada unit, and a financing system were typical contracts
the bank provided for multinationals, they said.
In the Milan and Parmalat criminal case, Citigroup denies it knew about the
financial situation of Parmalat before its failure, they said.
Citigroup relied on Parmalat's published audited results, credit rating
opinions and the company's corporate governance, they said.
In the Milan court, the next hearings are due July 15, with a trial expected
to start mid to end-September, they said.
In Parma, preliminary, pre-trial hearings will continue into the Autumn.
All the Citigroup employees cited in the investigations still work for the
bank in Italy, London and New York, apart from one who has retired, the sources
said.
nigel.tutt@thomsonreuters.com
nt/rw
COPYRIGHT
Copyright Thomson Financial News Limited 2008. All rights reserved.
The copying, republication or redistribution of Thomson Financial News Content,
including by framing or similar means, is expressly prohibited without the prior
written consent of Thomson Financial News.
|