The Ternium (NYSE: TX) steel group has agreed to receive payment in two installments for a 59.7% stake in Venezuelan steelmaker Sidor, an official from the country's basic industries and mining ministry (Mibam) told BNamericas.
"That part of the agreement has already been discussed but nothing has been definitively signed," according to the official.
The official added that Ternium plans to keep a 10% stake in Sidor. "The issue has always been part of negotiations but it wasn't clear whether it would be included in the end agreement," the official said.
Ternium has been negotiating an indemnity for Sidor since May 2008 when the Venezuelan government expropriated the steelmaker.
The parties were reported to have agreed on a price of US$1.65bn. However, considering that the international economic crisis has affected the company's value, and given Ternium's option to keep a 10% stake, the price may fall to no more than US$1.4bn.
If the agreement is finalized, Ternium would hold 10% of Sidor, the Venezuelan state would control 70.1% and the company's employees would keep 19.9%.
Sidor churned out 3.5Mt in 2008, down 16.9% from 4.3Mt in 2007, according to Mibam.
However, the steelmaker's profits came to US$400mn in 2008 due to high metal prices, Mibam head Rodolfo Sanz previously announced.
The Sidor plant, located in Ciudad Guayana, has liquid steel capacity of 4.2Mt/y.