Most often when a new company emerges in an industry it is usually closely monitored with excitement by the press and competitors. In this example however, quite the opposite is occurring. It's no secret the Venezuelan government has been seeking to nationalize several industries over the past few years. According to an article published in the New York Times, this may be the end of an era and the start of state run telecommunications in a county swaying toward socialism.
The private company at hand Nacional Telefonos, known more commonly as Cantv, will soon vanish. The article states that the overall vision is to remove the company from the New York Stock Exchange. Chavez's administration was able to finalize the transaction only after striking a deal with congress regarding oil. Once Cantv is completely delisted from the NYSE it will have huge implications for not only the industry but also several citizens.
For years Venezuelans have been using Cantv's stock as a means of getting around currency exchange controls. The methodology was that you could buy local shares and convert them into american receipts that could be sold for dollars, all in an effort to bypass currency restrictions imposed. This will now be a thing of the past. As if that wasn't enough, there now will be only one provider of telecommunication services in the country, a move that certainly will draw criticism. As a result, we see a new company crop up in a unique and unconventional way since it will be government run. Nevertheless, its impact will be felt even more so than a traditional startup entering the industry because of the scope of its customer base and general nature of the situation.
http://www.nytimes.com/2007/05/09/technology/09iht-cantv.4.5641611.html
No comments:
Post a Comment