Bolivia to take control of semi-privatised firms

LA PAZ, Bolivia - Bolivia's leftist government has said it will restore state control to a handful of companies that were semi-privatized in the 1990s, mostly by taking over shares held by private pension funds.

Bolivia nationalised its energy industry last month, but Planning Minister Carlos Villegas told reporters the plan to recover control of the six telecommunications, electricity and rail companies was not a further nationalisation.

In the last decade, a series of Bolivian companies were partially privatized. Foreign firms bought 50 per cent of the companies' stock in exchange for administrative control, with most of the remaining 50 per cent being entrusted to private pension funds on behalf of Bolivian pensioners.

Company workers and other small investors also hold a small portion of the shares.

The government's plan is to take over the 48 per cent to 49 per cent of each company currently held in pension funds controlled by Spain's BBVA and Switzerland's Zurich Financial Services and then to purchase another 2 per cent to 3 per cent in each company to reach 51 per cent.

The companies that would return to state control are Telecom Italia's Entel affiliate; power companies Corani, Guaracachi and Valle Hermoso, operated by US company Duke Energy Corp. and other US and Bolivian investors; the Andina rail operator, which is 50 per cent owned by Chile's Antofagasta; and the Oriental rail operator, which is partly held by US company Genesee & Wyoming Inc..

As part of its wider energy nationalisation, the government has already initiated a similar process in relation to three partially privatised energy companies that are currently controlled by the foreign energy companies Repsol YPF of Spain, BP Plc, Royal Dutch Shell Plc and Ashmore Energy International Ltd. of Britain

"Try as I might, I can't see that this is another nationalisation," Villegas, who heads the economic team of President Evo Morales, told reporters of the plan.

- REUTERS