Venezuelan President Hugo Chavez has nationalized the country's largest steelmaker Ternium Sidor. But the government still needs to buy out Ternium-Sidor's biggest stakeholder, the Argentinian consortium Techint. (Report: L. Kammourieh)
Venezuelan President Hugo Chavez on Monday nationalized the country's biggest steelmaker Ternium-Sidor, which is majority owned by Argentina's Techint.
Chavez signed the decree after announcing last month he would nationalize the company, which employs around 12,000 workers, following a breakdown in union contract talks.
"Today marks the beginning of a historic new era," Chavez told workers at the Ternium-Sidor steel mill in Ciudad Guyana, 500 kilometers (310 miles) southeast of Caracas.
"Here, beside these furnaces in the middle of Siderurgica del Orinoco (Sidor steel company), I have enacted the law by which we reclaim steel making," he told hundreds of company employees.
Chavez set a June 30 deadline for transfer of all Ternium-Sidor assets to the government.
At present, Argentina's Techint owns 60 percent of Sidor, which produced 4.3 million tonnes of liquid steel in 2006.
Chavez appointed Industry and Mining Minister Rodolfo Sanz as the nationalized company's president.
"Sidor now belongs to neither Chavez, Rodolfo Sanz, the appointed management nor to Sidor workers: Sidor now becomes a company owned by the Venezuelan people," he said.
Chavez said that besides Sidor, the nationalization law also extends to certain "Sidor subsidiaries and affiliated companies dealing with extraction and development."
He said the new measure, which the Supreme Court approved last week, was "a fundamental law to bring order to the entire steel industry (in the Guayana region), from mining to steel production."
Since first elected in 1998, Chavez a populist and leftist former army colonel, has been pushing through a socialist agenda. He nationalized oil fields in the Orinoco basin in 2006, and more recently cement companies run by Mexico and France.
Venezuela's Vice President Ramon Carrizales had announced on April 9 that the country would nationalize Ternium-Sidor, after talks on a union contract broke down.
Chavez on Monday also signed a new union contract with Ternium-Sidor workers after a months-long stalemate over wages.
"We've also signed a collective bargaining agreement," Chavez told the workers, "for which you fought so hard, and I congratulate you for having battled for justice. You're well aware that the union contract signed today is the best in this company's history."
Meanwhile, negotiations continued between the Chavez administration and the Techint consortium over a price to be paid for its shares, a source at Techint told AFP.
On Sunday, Chavez hinted at the difficulty of the talks in his weekly radio talk show Alo Presidente.
"We're going to pay what's fair, not the four billion dollars they told us," he said
Ternium-Sidor, state-owned until 1998, sold 3.9 million tonnes of steel products in 2007, including 2.5 million tonnes on the Venezuelan market, the company said in a statement earlier this month.
Date created : 2008-05-13