UPDATE 1-Parmalat cuts proposed dividend after accounts review

Fri May 10, 2013 3:03pm EDT

Related News

* Cuts proposed 2012 div to 0.013 euros/shr from 0.039 euros

* Says board to seek $144 mln cut in LAG deal price

* Says Q1 net profit up 67 pct to 55.8 million euros

MILAN, May 10 (Reuters) - Italian dairy group Parmalat has cut its proposed dividend by two-thirds and its net profit by half after a court ruling on an acquisition forced it to review its 2012 results, the company said on Friday.

On April 18 a court in Rome annulled Parmalat's 1998 takeover of Centrale del Latte di Roma, a publicly-owned milk company, ordering it to relinquish its 75 percent stake in favour of the former owner, the Rome municipality.

As a result of the review, Parmalat said it had reduced its dividend proposal for 2012 to 0.013 euros per share from 0.039 euros and had cut last year's net profit to 80.1 million euros ($104 million) from 175.2 million euros.

In a statement, Parmalat also said its board had decided to request a $144 million cut in the acquisition price of sister company Lactalis American Group (LAG).

Parmalat, majority-owned by French cheese maker Lactalis, is facing criminal and civil inquiries into the May 2012 deal, which critics say drained the Italian company of cash.

Parmalat paid a preliminary price of $904 million when the deal closed, with possible adjustments leading to a cut of up to $144 million or an increase of up to $56 million.

The company, which has been put under the oversight of a special commissioner as part of the probe into the LAG deal, has a May 31 deadline to agree with LAG over the final price.

Parmalat on Friday also released its first-quarter results, which showed net profit rising 67 percent from a year ago to 55.8 million euros.

It forecast net sales would rise about 3 percent this year and core profit would increase about 5 percent.