Venezuela said on Monday that it would take control of three foreign-owned cement businesses, but would let the current owners keep minority shares.
Venezuelan Oil Minister Rafael Ramirez made the announcement after talks with representatives of Mexico’s Cemex SAB, France’s Lafarge SA and Switzerland’s Holcim Ltd.
Venezuelan President Hugo Chavez announced the nationalization of the country’s biggest cement businesses last week, and Ramirez told state TV it could be handled much like the nationalization of oil projects last year.
“That’s to say, a share of participation by the Venezuelan state of a minimum of around 60 percent,” he said.
The foreign companies have not yet indicated if they would accept the terms and stay on as minority partners. Ramirez said the talks would lead to “agreements for us to move to a scheme of control.”
On Monday, Cemex issued a statement “expressing its willingness to talk with [Venezuelan] authorities to find a mutuallly acceptable solution” as Venezuela moves ahead with the takeover.
Last week, Mexico’s government condemned the nationalization and summoned the Venezuelan ambassador to discuss the issue.
Chavez said on Sunday that he had been contacted by the concerned owners of some small cement businesses in the western state of Zulia, and they have been assured that the nationalization will not affect them.
“I asked for them to be told that, ‘No, what we’re going to do is nationalize what was privatized’” in the past, the president said.
He called those being nationalized “the big cement companies that were taken away, practically given away — those big plants that are property of the state, [and] always have been.”
Ramirez said Venezuelan officials told representatives of the foreign companies that they aim to establish state “control of some basic businesses that are fundamental for carrying out our entire national development plan.”
Chavez has accused foreign-owned cement companies of restricting domestic supply and boosting exports to maximize profits.
He has assured the companies they will be fully compensated for their assets.
The cement takeover is Chavez’s most significant nationalization move since last year, when the government took control of telecommunications and electricity companies, along with the country’s last remaining privately run oil projects.
Government officials argue cement supply has been a problem in the past and they note that Venezuela has suffered from a severe housing shortage for decades.
Cemex runs three cement plants in Venezuela that produce about 4.2 million tonnes annually, as well as 13 distribution centers and four maritime export terminals.
Holcim has two plants that produce 2.7 million tonnes a year. And Lafarge has two plants that produce 1.4 million tonnes a year, the company’s Web site said.
Miguel Octavio, executive director of BBO Servicios Financieros, a Caracas brokerage, estimated that the Venezuelan assets of the three companies are worth US$1.8 billion to US$2.2 billion.
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