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Mexican corn firm to lose income after Venezuela seizure

05-18-2010 13:48 BJT

MEXICO CITY, May 17 (Xinhua) -- Grupo Maseca (Gruma), Mexico's largest maker of corn flour, will lose 18 percent of its income after the Venezuelan government seized its units based there, Mexican banking giant Banamex said Monday.

"Gruma will immediately lose its third largest subsidiary, which presented 18 percent of its total income last year," Banamex said.

Both Mexico and the United States, Gruma's largest markets, are recovering from recessions. Corn flour is the main ingredient in Mexico's staple food, the tortilla. It is also widely used in cooking all over the southern United States.

Last week, Gruma said it had begun negotiating with Venezuela to set a price on the assets, such as the plants and inventory. Gruma paid around 97 million U.S. dollars for Monaca, its Venezuelan unit, in 1999.

Venezuelan President Hugo Chavez has repeatedly blamed foreign firms for raising food prices in his nation, harming the nation's poorest and triggering an inflation spiral. Venezuela has previously expropriated the Venezuelan unit of Mexican cement giant Cemex.

Editor:Zhang Jingya |Source: Xinhua

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