Venezuela nationalized major electricity utility

Pdvsa buys 82.14 percent of largest power company for USD 739.2 million

President Hugo Chávez' Government and US energy multinational AES Corporation, late Thursday announced they are initialing a memorandum of understanding under which Venezuela's largest private power firm La Electricidad de Caracas (EDC) will be nationalized. The move came one month after the Venezuelan ruler publicly announced his decision to take control of the company.

Venezuelan state-run oil holding Pdvsa and EDC were engaged in negotiations that resulted in agreement under which the Venezuelan State is taking over control of approximately 82.14 percent of stocks, which are currently in AES hands.

Under the memorandum of understanding between the parties, the Venezuelan state is to pay AES Corp. USD 739.2 million for 82.14 percent of capital stock. This represents less than half the sum AES Corp. paid to purchase a majority stake un EDC back in June 2000, when it submitted a takeover bid for USD 1.6 billion.

EDC proposes dividend of USD 4 cents per share

Venezuela's largest private power firm La Electricidad de Caracas (EDC) is proposing payment of cash dividends for USD 4 cents per share in a stockholders' meeting to be held next March 1st, the company said on Friday.

The board of directors said it made the decision late Thursday, Reuters reported.