Venezuela's Movilnet To Invest Around $220 Million In 2005

CARACAS -(Dow Jones)- Movilnet, the cellular division of CA Nacional Telefonos de Venezuela, or CANTV (VNT), will increase investment to around $220 million in 2005 to expand and improve services, Movilnet President Jose Maria De Viana said Wednesday.

"We will invest $220 million this year," said De Viana, speaking at a press conference.

He said the company invested $160 million to $180 million in 2004. The company has said it expects to spend a total of $800 million from 2005 to 2009 to expand its network.

Movilnet expects its base of cellular clients, currently at around 3.1 million, to grow 15% this year, similar to the company's client growth in 2004.

"In general, the cellular sector is growing a lot," said Bernard Fisher, an executive at the company.

"Fifteen percent growth in prepaid and postpaid clients, that is the projection" for this year, he added.

Movilnet competes with Telcel BellSouth, the Venezuelan unit of the U.S. telecommunications firm BellSouth Corp. (BLS.N). Movilnet also competes with Digitel, a local division of Telecom Italia SpA (TEF).

Venezuela's economy has been growing fast after recovering from a recession in 2002 and 2003 that was caused by numerous general strikes and a failed military coup against the government of President Hugo Chavez. Venezuela's economy is expected to grow 5% in 2005, according to the government.

-By Peter Millard, Dow Jones Newswires; 58212-5641339; peter.millard@dowjones.com;

(END) Dow Jones Newswires"

Posted to the site on 16th February 2005