Venezuela buys majority of Lafarge subsidiary

Venezuela buys majority of Lafarge subsidiary
Published: 01 October 2009

Venezuela’s government has purchased 93.8 per cent of the local subsidiary of Lafarge SA, the Caracas Stock Exchange said Wednesday.

The state-run Corporacion Socialista Cementera bought the shares of Lafarge’s Fabrica Nacional de Cementos for US$247m, the exchange said in a statement.

President Hugo Chavez’s government nationalized Lafarge last year along with Cemex and Holcim. None had previously been compensated, and both Cemex and Holcim have filed for international arbitration to recover their assets.

Infrastructure Minister Diosdado Cabello said last week the government would pay Lafarge 40 per cent of the agreed-upon purchase price, or US$118.5m, for its two Venezuelan subsidiaries within five days. He said it would pay the remaining 60 per cent over four years without interest.

It was unclear what led to the change in plans or what would happen to the second company, Cementos Tachira, following Wednesday’s deal.

Chavez’s government has also nationalized major companies in the metals, oil and electricity sectors as it moves to build a socialist economy.