A Chinese court has declared bankrupt the
company at the center of a scandal over tainted milk - blamed for
killing six children and sickening almost 300,000 more, one of the
company's owners said Wednesday.
Sanlu was one of 22 Chinese dairy companies whose products were
found to contain high levels of the industrial chemical melamine,
leading to the deaths of six babies and causing 294,000 others to
suffer urinary problems.
Fonterra, a New Zealand farmer-owned cooperative, owns
43 percent of Sanlu.
New Zealand's Fonterra Group said that a court in Shijiazhuang,
in China's Hebei province, issued a bankruptcy order against Sanlu
Group Co. in response to a petition from a creditor.
Fonterra was responsible for
alerting Chinese authorities to the tainted milk
scandal in August, and by late September had slashed the value of
its investment in the Chinese dairy group by $139 million to an
estimated $62 million.
Fonterra, which controls more than 95 percent of New Zealand's
milk supply, is the country's largest multinational business, its
second-biggest foreign currency earner and accounts for more than
24 percent of the nation's exports.
"By now, it has been made clear how much Sanlu owes the
distributors and creditors, but not the victims' families,"
Beijing-based lawyer Xu Zhiyong, who represents dozens of families
with sickened children, said in a telephone interview.
"In theory, those who were physically harmed should get
compensation first," Xu said. "But our concern right now is that
... the creditor bank or banks will
collude with the local government
to make Sanlu's assets go to compensating themselves first."
http://sg.news.yahoo.com/ap/20081224/tap-as-new-zealand-china-tainted-milk-bb10fb8.html