Mexican cement giant Cemex has said it planned to go to the World Bank to seek arbitration after Venezuela's government seized the firm's local subsidiary.

Cemex argues that the move to take over the firm's assets in Venezuela and nationalise the business, is illegal.

Unlike other cement firms Holcim and Lafarge, which have agreed to hand over local subsidiaries to the Venezuelan government, Cemex has yet to agree.

President Hugo Chavez plans to nationalise a number of businesses.

'International law'

Government officials, with the backing of the National Guard, took over the firm's factories on Monday after 60 days of talks ended without agreement.

Cemex now intends to go to the International Centre for Settlement of Investment Disputes, arguing that the move was a "flagrant violation" of the country's constitution.

The firm said it was offered US $650 million for its local operations-a sum that "significantly" undervalued the business. It had wanted US$1.3 billion.