Venezuela to Purchase Verizon's 28.5% Stake in Cantv

[Judi Lynn]

Venezuela to Purchase Verizon's 28.5% Stake in Cantv (Update3)

By Matthew Craze and Alex Kennedy

Feb. 12 (Bloomberg) -- Venezuela's government agreed today to buy Verizon Communications Inc.'s 28.5 percent stake in CA Nacional Telefonos de Venezuela as President Hugo Chavez seeks control over key industries.

Venezuela will pay $572 million for the stake, or $17.85 a share, an 11 percent premium on Cantv's closing share price of $16.08 in New York today. The deal was signed in Caracas by Jesse Chacon, Venezuela's telecommunications minister, and John Diercksen, Verizon's executive vice president of strategy and development, on Venezuela's state television channel.
(snip)

The deal has been under a cloud for a month, since Chavez said he wouldn't pay market price for Verizon's stake and planned to deduct the value of pensions owed to former workers. Cantv's American depositary receipts have fallen 18 percent so far this year in New York.
(snip)

``Today is a happy day for the Republic,'' Rodriguez said. ``We have reached an agreement that is very favorable for Venezuela.''
(snip/...)

http://www.bloomberg.com/apps/news?pid=20601086&sid=aIZAb2ystsII&refer=news

[Judi Lynn]

1. Venezuela Moves to Buy Verizon Stake

Feb 12, 9:46 PM EST

Venezuela Moves to Buy Verizon Stake

By NATALIE OBIKO PEARSON
AP Business Writer

CARACAS, Venezuela (AP) -- Venezuela's government signed a preliminary agreement to purchase Verizon Communications Inc.'s stake in the country's largest telecommunications company, the latest move by President Hugo Chavez to nationalize strategic sectors of the economy.

The government will buy Verizon's 28.5 percent in Compania Anonima Nacional Telefonos de Venezuela, or CANTV, for $572 million, Telecommunications Minister Jesse Chacon said Monday.

The agreement was "transparent" and "begins the process of nationalization of one of the most strategic companies for the country's development," Chacon said after signing the memorandum of understanding with John Diercksen, New York-based Verizon's executive vice president of strategy, development and planning.
(snip)

CANTV, a former state company, was privatized in 1991. The company has 13,000 employees, 3.25 million fixed-line customers, 6.76 million cellular customers, and 592,000 Internet subscribers.
(snip/)

http://hosted.ap.org/dynamic/stories/V/VENEZUELA_NATIONALIZATION?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2007-02-12-21-46-01

[1932]

3. It will be fascinating to see where this goes.

[BushOut06]

2. I thought Chavez was a ruthless dictator?

If so, why didn't he just take it? :sarcasm:

[killbotfactory]

5. Yeah!

I thought he would just take it and not pay fair market price like the Venezuelan Constitution requires, because he rules by decree and is the next Castro or something.

[Guy Whitey Corngood]

4. .