:. Food Industry News

Categories: Mergers and Acquisitions

China Milk Scandal Company to Be Auctioned Off

Source: Reuters
13/02/2009

Beijing, Feb 13 - The assets of the dairy company at the centre of China's melamine-tainted milk scandal that killed six children will go up for auction early next month, the official news agency Xinhua said on Friday.

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The auction comes after Tian Wenhua, the former chairwoman of the Sanlu Group, was sentenced to life last month and fined $3.6 million for her role in the scandal.

Sanlu had borrowed $132 million to pay medical fees for the 300,000 children that fell ill last year after they drank milk laced with melamine, a toxic industrial compound, adding to its debt burden, said Xinhua.

Earlier this month, Sanlu's Tian appealed her life sentence saying her trial lacked evidence.

Tian was convicted last year at Shijiazhuang Intermediate People's Court of manufacturing and selling fake or substandard products.

Two men were sentenced to death and three former Sanlu executives received jail terms of five to 15 years.

The scandal was the latest in a string of food safety failures that have tarnished the image of goods made in China.

Xinhua also said the Shanghai Municipal Bureau of Quality and Technical Supervision found no melamine in milk powder produced by Dumex, the powdered-milk unit of France's Danone.

The bureau had checked milk powder produced by Dumex since September, and no melamine was detected in 932 batches totalling more than 6,188 tonnes, said Xinhua.

Local media had earlier reported that Dumex products had caused 48 children to become ill. ($1 = 6.84 yuan)



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