Venezuela to nationalize steel maker
CARACAS, Venezuela (AP) - April 9, 2008 Vice President Ramon Carrizalez announced the move on state
radio Wednesday morning, noting the nationalization comes after
months of difficult negotiations between the steel maker Sidor and
its workers, who have been demanding better salaries and benefits.
Carrizalez, who held talks with union and company
representatives early Wednesday, said Chavez did not want to permit
the labor conflict to continue. The government tried to help reach
an agreement but the company "didn't give in," Carrizalez said,
according to the state-run Bolivarian News Agency.p>
"They wanted the government's support for the brutal system
they used in that company, and of course this is a government that
supports the workers," Carrizalez said.p>
He said one option would be for the government to take about 60
percent of the company, with the company's owners keeping a
minority share.p>
Carlos Becerra, a leader of the Unified Union of Steel Industry
Workers, told The Associated Press that Carrizalez informed the
union and company representatives that the government will
immediately nationalize Sidor.p>
Sidor's parent company, Luxembourg-based Ternium SA, is
controlled by Argentine-Italian conglomerate Techint Group.
The company - whose formal name is Siderurgica del Orinoco - was
privatized in 1998.p>
Workers have held protests at Sidor's steel plans in the eastern
state of Bolivar, at times clashing with police.p>
Chavez on Sunday said he had instructed Carrizalez to meet with
union leaders to discuss the situation. Chavez said the government
"has to demand with great firmness that any company ... comply
with Venezuelan laws."p>
The nationalization of key industries has been a centerpiece of
Chavez's socialist agenda in the past two years. The government
took majority control of telecommunications and electricity
companies last year, along with Venezuela's last remaining
privately run oil projects.p>
Chavez also announced plans to nationalize major cement
companies last week, and his government is now in talks on the
terms with Mexico's Cemex SAB, France's Lafarge SA and
Switzerland's Holcim Ltd.p>
Venezuela plans to assume at least 60 percent ownership in the
cement businesses, and has said the foreign companies will have the
option of staying on as minority partners.p>
Becerra said union and company representatives were present at a
meeting early Wednesday where Carrizalez announced the government's
stance on the steel maker.p>
Another union leader, Nerio Fuentes, told the Venezuelan
television station Globovision that company workers "have taken
possession" of the steel maker's facilities.p>
Ternium's shares on the New York Stock Exchange were down more
than 9 percent after the news in early trading.p>
Ternium owns 60 percent of Sidor, while the Venezuelan
government holds 20 percent and the remainder is in the hands of
current and former employees.p>
Last year, Chavez warned Sidor's owners that he might
nationalize the steel maker, complaining it was selling the bulk of
its production overseas instead of giving priority to Venezuelan
industry.p>
At the time, Chavez said if Sidor didn't agree to supply the
domestic market first, "I'll grab your company ... and I'll pay
you what it's worth."