CHILE FORMALLY TAKES ITT STAKE IN PHONE FIRM

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP09T00207R001000030025-5
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: August 5, 2011
• Sequence Number: 25
• Publication Date: December 12, 1974
• Content Type: OPEN SOURCE

Sanitized Copy Approved for Release 2011/08/05: CIA-RDP09T00207R001000030025-5
Iz DEC 1974
Chile Formally..
Takes ITT Stake
In Phone Firm
Action,Called Step to Clear
Way for Paying ITT;
`Meaningful' Talks Held
A WALL STREET JOURNAL Vetos Roundup
The Chilean government formally expro-
priated the 70% interest in Chile Telephone
Co. owned by International..Telephone & Tel-.
egraph Corp., an action ITT described as a
"procedural" step to clear the way for com-
pensation to ITT. .
The matter of compensation to ITT has
been at issue between the big conglomerate,
Chile and a U.S. government agency ever
since 1971. That year, the Marxist Chilean
government of the late Salvadore Allende
"intervened". in the telephone company,
taking over. its operation without actually
nationalizing it.
ITT attempted to negotiate with the Al-
lende government, but also filed a $95 mil-
lion insurance claim with Overseas Private
Investment Corp., .a. U.S.. agency that in-
sures U.S. companies' investments abroad.
OPIC, however, rejected, the claim in 1973,
in the midst of charges by ITT's critics that
ITT had plotted to influence Chilean elec-
tions and overthrow President Allende.
ITT then exercised its right to arbitration
of the claim, and a panel of arbitrators de-
cided last 'month that OPIC should pay. The
actual amount of compensation hasn't been
set however.
President Allende's government was
ousted in September 1973 by the present mil-
itary regime, and he committed suicide.
The current government has published a
decree in its official journal appropriating
ITT's stock in the phone company, the Asso-
ciated Press reported from Santiago. The
government said it will reimburse ITT after
negotiations.
ITT values its investment at $153 million
and submitted a claim for roughly 6017o of
that to OPIC.
In New York, an ITT, spokesman said
that the company is engaged in "meaningful
negotiations" with the Chilean government
and that the announced expropriation was
"a procedural, legal step which clears the
way for eventual compensation to
ITT...." He said the action relates only to
the phone company and doesn't affect ITT's
other properties in Chile. Those assets in-
clude two Sheraton hotels and interna-
tional-communications services.
In Washington, an OPIC spokesman said
settlement of ITT's claim against the
agency would be held up until the company
completes its negotiations with the Chilean
government.
Sanitized Copy Approved for Release 2011/08/05: CIA-RDP09T00207R001000030025-5