General Motors Co. is taking a $100 million charge to write off its operations in troubled Venezuela, where authorities last month unexpectedly seized its production plant on a court order, the company said Tuesday.
The write-off is effective as of May 1, GM said.
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The company has ceased all operations since the April 18 takeover of its facilities but said in a statement that it is open to discussing with Venezuela's government the possibility of restarting production "with a new, viable business model."
Car output, along with most industrial activity, has plummeted in the South American country amid a punishing economic crisis where companies and individuals lack access to hard currency because of the leftist government's rigid controls.
Unable to pay for imports, GM's Venezuela unit hasn't assembled a vehicle since December 2015, data from the Venezuelan car makers' association shows.
While the government has nationalized scores of companies over 18 years of socialist rule, authorities say the GM plant seizure wasn't an expropriation. Instead it is linked to a nearly two-decade-old lawsuit filed against the company by a local dealership, who sued GM for $370 million alleging wrongful termination of its concessionaire contract .
GM, which has called the suit "absurd," said it filed an appeal with Venezuela's Supreme Court last week to reverse all related civil and criminal actions.
"The company expects a prompt decision and favorable outcome," GM said.
Write to Kejal Vyas at email@example.com
(END) Dow Jones Newswires
May 03, 2017 02:48 ET (06:48 GMT)