New York, March 3 - A U.S. judge on Monday approved a settlement of 10.5 million shares for common stock holders and bond holders of Parmalat SpA , part of long-running securities litigation arising from the Italian dairy firm's bankruptcy and near collapse in 2003.
The settlement approved by Judge Lewis Kaplan in U.S. District Court in Manhattan is worth about 15.4 million euros ($19.5 million) at Monday's closing price of 1.47 euros a share.
In what Kaplan described from the bench as an "amazingly complex, costly and lengthy litigation" started in 2004, the settlement includes class members worldwide.
Parmalat said in a statement: "Parmalat will deliver 10.5 million Parmalat shares as total and final consideration for the settlement, to be issued and delivered within thirty days from when the order becomes final."
Since its collapse in 2003, Parmalat has restructured and relisted on Milan's bourse. It is Italy's biggest listed food company, best known for its long-life milk.
In June 2007, the Italian dairy group settled claims with three banks for a total of 72 million euros ($96.5 million at the time).
Parmalat settled outstanding damage claims with Merrill Lynch, and revocatory claims with Italy's Banca Monte Parma SpA [BPARMA.UL] and ING of the Netherlands .
Kaplan ruled last week that Parmalat SpA investors may pursue a lawsuit seeking damages against the auditor Grant Thornton International for its alleged role in a fraud that caused the company's troubles.
On Jan. 27, Kaplan rejected efforts by the auditor Deloitte Touche Tohmatsu [DLTE.UL] to dismiss a similar lawsuit.
In court on Monday, Kaplan asked lawyers for the two auditing firms to provide him a joint letter within a week describing "what needs to be done before the accountants proceed to trial." No date has been scheduled for a trial.
Parmalat collapsed with about 14 billion euros ($17.82 billion) of debt after uncovering a 4 billion euro ($5.09 billion) hole in its books. It emerged from bankruptcy in 2005.
The case is In Re: Parmalat Securities Litigation 04-01653 U.S. District Court for the Southern District of New York (Manhattan)
(1 euro = US$1.26)