  |
|
Venezuela to seize biggest private telecom immediately
ABN
Venezuela's President Hugo Chavez speaks during his weekly program 'Alo Presidente' at Miraflores Palace in Caracas January 21, 2007.By Elio Ohep
Petroleumworld
CARACAS
Petroleumworld.com 01 22 06Venezuelan President Hugo Chavez on his television show on Sunday order his telecommunications minister Jesse Chacon to take over Compania Anonima Nacional Telefonos de Venezuela, (CANTV), immediately without first compensating its shareholders, US Verizon Communications Inc. among them, and said the government will pay some money in the future but won't pay market price in advance for the telecom.
"You have to act, I've already given the instructions," Chavez said to Chacon.
" We're going to take it over first, and pay later.'' Chavez added.
c announcement to nationalize the nation's biggest phone company, came during his weekly radio and TV broadcast show "Alo Presidente" and threw a doubt on whether all shareholders would receive fair compensation for its stake in CANTV and will surely made the Shares of CANTV fall.
"So I don't want to hear stories about how I have to pay at such and such price, at the international price, no, no, no, " Chavez said.
When the government decides how much it's willing to pay for the CANTV, it will deduct the value of pensions owed to former workers, Chavez said.
CANTV "was given away" in 1991, when state-owned company was privatized, Chavez said.
But it seem that Chavez move is a calculated one, delaying the payment to CANTV shareholders would produce a crash perception in the market that will make investors bail out and drive the price of the paper to the floor for Chavez government gain in the price it would pay for the stock.
The company worth is estimated at $4 billionChavez said after his government decides what it's willing to pay for CANTV, it will subtract the value of pensions owed to about 4,000 former employees.
Since Jan. 8, when Chavez announced CANTV nationalization, the company stock has fallen more than 30 percent in the U.S. and 19% in Venezuela.
CANTV'S American Depositary Receipts have slumped 20 percent to $13.49 in that period, giving the company a market value of $1.44 billion. Each ADR is equal to seven local Class D shares. CANTV stock hadn't traded in Europe this morning by 10:45 a.m. Frankfurt time, according to Bloomberg.CANTV was sold to private investors in 1991, under former government of President Carlos Andres Perez, New York-based Verizon Communication Inc. has a 28.5 percent stake, with the Venezuelan government 30% stake and 25% on private investors, the rest is on the capital markets.
Chavez also has said he plans to nationalize and take state control of four extra heavy oil projects in the Orinoco Belt area, the electricity sector, and the natural gas sector.
Also, Chavez took the opportunity on its TV show, to tell the U.S. Goverment told to "Go to hell, gringos!" and called Secretary of State Condoleezza Rice "missy" on, lashing out at Washington for what he called unacceptable meddling in Venezuelan affairs.
Last week, Washington raised concerns about a measure to grant Chavez broad lawmaking powers.
Venezuela is one of the world's leading petroleum exporters.
- Elio Ohep, editor@petroleumworld.com, 58 412 996 3730, Caracas.
Petroleumworld 21 01 07
Copyright© 1999 Petroleumworld. All Rights Reserved.
Your
feedback is important to us!
We invite all our readers to share with us
their views and comments about this article.
Write to editor@petroleumworld.com
Any
question or suggestions, please write to:
editor@petroleumworld.com
Best
Viewed with IE
5.01+
Windows
NT 4.0, '95, '98 and ME +/ 800x600 pixels