Mexico's Cemex S.A.B. de C.V. announced recently that it has received payment of US$600 million from the Government of the Bolivarian Republic of Venezuela and its public entity Corporación Socialista del Cemento, S.A. as compensation for the nationalization of Cemex Venezuela, S.A.C.A. In addition, US$154 million of accounts payable by Cemex subsidiaries to Cemex Venezuela have been cancelled.
Compensation was paid US$240 million in cash and in various negotiable securities issued by Petróleos de Venezuela, S.A., the Venezuelan state oil company, that during their full term pay an aggregate total of US$360 million. Cemex intends to use the funds received from this compensation for the repayment of indebtedness and general corporate purposes.
When the compensation arrangement was first announced in early December, the government of the Bolivarian Republic of Venezuela, Corporación Socialista del Cemento, S.A., and Cemex said they were pleased with the resolution of this dispute and looked forward to further the relationship between Venezuela and Mexico. According to a statement released by Cemex, the company is grateful for the support received from the presidents and chancellors of Mexico and Venezuela in this matter.
In April 2008, Venezuela decided to nationalize the cement industry, affecting Cemex, Lafarge SA of France, and Holcim Ltd of Switzerland, the three giants in the industry.