Chavez moves on telecoms company

President Chavez accuses CANTV of tapping his phone

Venezuela's government has bought 28.5% of the country's top telecoms company CANTV, which President Hugo Chavez has accused of spying on him.

The stake was bought from US-based Verizon Communications for $572m (£295m), more than $100m less than was offered by a Mexican tycoon last year.

It is only a month since Mr Chavez called for the nationalisation of Venezuelan power and telecoms firms.

It is part of his plans to turn the country into a fully socialist state.

CANTV's remaining shareholders include Spain's Telefonica.

At a summit of South American leaders last month, Mr Chavez accused CANTV of recording his conversations at the bidding of the "empire", which is a term he generally uses to refer to the US.

CANTV has denied the allegations.

The deal with Verizon may turn out to be worth more than $572m if it allows the US company to receive its annual dividend, which was a condition of last week's deal with AES.

Last week the government agreed to pay AES $740m for its 82% stake in Electricidad de Caracas.

The deal takes the Venezuelan government's stake in CANTV to 35%. Remaining shareholders in the firm include Spain's Telefonica, public stockholders and employees.

The government has said it will aim to acquire the rest of the shares by making a public offer for them.