French dairy group Lactalis has launched a €3.4bn (£3bn) bid for Parmalat, its Italian rival, to create the biggest dairy group in the world.
Lactalis, which already owns 29 per cent of Parmalat, has offered €2.60 for each share to create a business with estimated combined annual revenues of €14bn. The French group announced its offer hours before a meeting between the French and Italian premiers. Italy passed a decree last month to thwart foreign buys of big Italian companies.
Italy's Prime Minister Silvio Berlusconi said he hoped the offer would result in joint Italian-French ownership of Parmalat, which Lactalis plans to keep listed on the Milan stock exchange.