Mexican milk company Lala buys Parmalat Mexico assets

MEXICO CITY --Mexican dairy products concern Grupo Industrial Lala SA has agreed to buy the local assets of Italy's Parmalat Finanziaria Spa (PRF.MI), a company official said Friday.

Luis Manuel Perez, Lala's director of human resources, said in a phone interview that Lala has bought "a good part" of Parmalat's Mexico assets, including its plant in Jalisco state.

He declined to say how much Lala is paying for the deal, which includes a license to market Parmalat brands in Mexico.

The acquisition still requires antitrust clearance, which is expected within three or four weeks, Perez said.

He said Lala has a 12% to 14% market share for dairy products in Mexico, and up to 40% in some segments. Parmalat Mexico has a 7% share of the specialized milk segment, which includes long-life and skimmed milk.

Perez said Parmalat's market share contribution is small, and that Lala's main interest was the brand.

"Our strategy is for people to continue having the brand that they are used to," he said.

Parmalat, based in Milan, filed for bankruptcy protection from creditors last December following a management fraud scandal.

The insolvent Italian dairy products concern said in March that it would sell off assets in about 20 countries, including Mexico.

Lala, based in the northern Mexican city of Torreon, has eight pasteurizing plants in Mexico and 128 distribution centers, selling close to 4 million liters of milk a day.

Perez said Parmalat will use part of the proceeds from the sale to pay severance to its workers.