Sidor workers' dividend payments to begin Jun 30

Monday, May 30, 2005

Shareholders of Venezuela's largest steelmaker Sidor, officials from the local mining and basic industry ministry (Mibam) and representatives from state heavy industry holding company CVG have signed an agreement to start paying dividends to Sidor workers on June 30, a shareholders' spokesperson told BNamericas.

"At last Friday's meeting some pre-agreements were reached and it was agreed to submit the minutes of the meeting to minister [Víctor Álvarez]. We are expecting to sign the minutes so the agreements are definitive," said the spokesperson, Giovanni Barrios, who represents workers who own shares in Sidor.

Under the pre-agreements, CVG acknowledges the rights of series B shareholders, present and past workers, and assigns them dividends for a total of US$94mn for the years 2003 and 2004.

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"Of this amount 20% will be used to repay the debt left when we bought the shares," Barrios said.

Future dividend payments will alternate between 50% in the form of debt payment and 50% cash, and the 20:80 breakdown.

Apart from the dividends and payment mechanism, the agreements cover the transfer of pending shares in order to complete the workers' 20% stake in the company, Barrios said.

"Now we only hold a 9.61% interest and still [10.39%] is missing to reach the balance. August 15 was the date previously agreed to transfer the shares to the workers," he added.

CVG holds a 40.2% interest in Sidor, with workers holding half of that.

"CVG earmarked US$188mn from 2003 and 2004 dividends for the 40.2% and we're due to receive half of that, so we're claiming US$94mn," the Sidor spokesperson said.

The dividend distribution issue impacts nearly 2,000 current and retired Sidor employees who took part in a workers' participation program promoted by Venezuela's government through CVG.

Sidor is almost 60%-owned by the Amazonia consortium of Mexico's Hylsamex, the Techint group, Brazil's Usiminas and Venezuela's Sivensa.