CARACAS (Reuters) - President Hugo Chavez’s government said on Wednesday it was taking control of a landmark hotel run by Hilton on Margarita island, announcing another nationalization by socialist-run Venezuela.
The 280-room hotel last month housed the likes of Zimbabwe’s President Robert Mugabe and Libyan leader Muammar Gaddafi for a summit of African and South American leaders.
An official decree from Chavez said the hotel complex, which also has 54 suites and 154 timeshare suites, was being taken over due to “the need to boost tourism” on Margarita, one of Venezuela’s prime Caribbean destinations.
Tourism Minister Pedro Morejon said the government, which is working out ownership stakes after previously taking over two local companies with shares in the hotel, would honor employees’ contracts and tourism bookings.
He accused Hilton, whose concession ran out this week, of failing to maintain installations, which he said were in a “high state of deterioration.”
In a statement, Hilton, which manages but does not own the hotel, said it was “evaluating how the Venezuelan government’s action affects its interest in this hotel.”
The hotel remains a part of the Hilton system, added the company, which is owned by private equity firm Blackstone Group.
Under Chavez, Venezuela has pursued an aggressive nationalization policy, principally in the oil, telecommunications, electricity, metal and land sectors.
Hilton has lost control of two other hotels in Venezuela, when concessions ran out.
Reporting by Fabian Cambero and Deepa Seetharaman in New York; writing by Andrew Cawthorne; editing by Mohammad Zargham