MONTERREY, Mexico, (Reuters) - An international
court has rejected a request by Mexican cement maker Cemex to
protect it from further expropriations by Venezuela after a
2008 nationalization of its Venezuelan assets.
The Washington-based International Center for Settlement of
Investment Disputes said on its website Wednesday night that it
could not take "preventive measures" in favor of Cemex (CX.N)
(CMXCPO.MX), the world's No. 3 cement maker.
Cemex had asked the Washington-based ICSID to stop
Venezuela from taking control of three Panama-based cement
vessels that were under the control of Cemex's Venezuela
operations before the August 2008 nationalization.
The demand is part of a wider court case in which Cemex is
seeking $1.3 billion in compensation for the seizure of its
assets. Venezuela has offered about a third of that.
A Cemex spokesman said on Thursday that Panama's Supreme
Court recently gave Cemex control of the boats. He said the
ICSID ruling was "irrelevant."
Shares in Monterrey-based Cemex, which has operations in
more than 50 countries, fell 2 percent to $9.98 on the news in
New York and 1.8 percent to 12.76 pesos in Mexico City.
"This is something that could complicate Cemex's overall
bid for compensation. It is going to take a long time," said
Francisco Chavez, an analyst at BBVA Bancomer.
Cemex had hoped to use compensation from Venezuela to help
reduce its $15 billion debt load as it struggles with slumping
U.S. and European cement volumes due to the global recession.
Cemex took on big debts to finance its acquisition of
Australia's Rinker in 2007.
Socialist President Hugo Chavez nationalized Cemex's
Venezuelan assets, accusing the company of pollution that was
harming local residents.
Cemex denied any wrongdoing, arguing it had invested
heavily in its plants in recent years, switched its sales focus
to the domestic market, cut exports, and increased its social
program to help low-income families build homes.
Venezuela was a profitable market for Cemex, but the
nationalization has not hurt the company's overall earnings
because its sales volumes there were small.