UPDATE 2-Venezuela to take control of Ternium Sidor

(Adds Chavez quote, details)

CARACAS, April 30 (Reuters) - Venezuela's President Hugo Chavez said on Wednesday the government will take control of the country's top steelmaker, Argentine-controlled Ternium Sidor, even as negotiations with the company continue.

Socialist Chavez signed a decree to nationalize the steelmaker and said he would name a commission to take control of the company, part of his drive to increase government participation in key industries.

"We are going to sign a law by which Venezuela will recover our Sidor," he told cheering union members. "This decree names a commission to take control of the company and put it to the interests of the nation."

When Chavez nationalized several foreign-owned oil projects last year, workers took the installations during the May 1 labor celebrations, but talks with the companies carried on.

In recent days, Chavez has stepped up pressure on Ternium (TX.N: Quote, Profile, Research, Stock Buzz) to strike a deal over the value of the sprawling Sidor plant on the Orinoco river.

On Sunday, he called the company "crazy" for asking for $4 billion for its holdings and threatened to expropriate if it did not quickly lower its demands.

Sidor employs almost 15,000 workers and last year produced 4.3 million tonnes of liquid steel despite sporadic strikes in a drawn out labor dispute that prompted Chavez to nationalize . He announced the planned takeover earlier in April.

The government is also in the process of nationalizing foreign-owned cement companies such as Mexico's Cemex (CX.N: Quote, Profile, Research, Stock Buzz).

It has typically paid reasonable compensation for nationalized property. (Reporting by Frank Jack Daniel; Editing by Ben Tan)