Venezuela plans to nationalize telecoms, electrical companies

CARACAS, Venezuela — Venezuelan President Hugo Chavez announced plans Monday to nationalize the country’s electrical and telecommunications companies, his boldest move yet to transform Venezuela into a socialist state.

“All of those sectors that in an area so important and strategic for all of us as is electricity — all of that which was privatized, let it be nationalized,” Chavez said in a televised speech after swearing in a new Cabinet.

“C.A. Nacional Telefonos de Venezuela (CANTV), let it be nationalized,” Chavez said. “The nation should recover its property of strategic sectors.”

When Chavez was re-elected by a wide margin last month, he promised to take a more radical turn toward socialism. Monday’s announcement appeared likely to affect Electricidad de Caracas, owned by AES Corp., and CANTV, which is the country’s largest publicly traded company.

CANTV’s American Depositary Receipts plunged 14.2 percent to $16.84 (12.95 euros) before the New York Stock Exchange halted trading. The ADRs had been moderately higher before the announcement.

An NYSE spokesman said it was unknown when trading in the ADRs might resume and that CANTV is the only Venezuelan company listed on the stock exchange.

Chavez also said he would soon ask the National Assembly, which is solidly controlled by his allies, to approve a special law giving him powers to approve such changes by decree and without further approval.

Chavez also said that lucrative oil projects in the Orinoco River basin involving foreign oil companies should be under national ownership, though he did not spell out if that meant a complete nationalization, or under what terms for companies that have been viewed as investing partners by his government.