MADRID – Venezuelan President Hugo Chavez and Spain's King Juan Carlos appeared to have put their dramatic public spat of 2007 well behind them when they met on Friday, even sharing a joke about the monarch's recently grown beard.

Chavez said to the king: You've grown a beard like Fidel, referring to former Cuban leader Fidel Castro, to which the king replied: I'm changing my look.

Relations between the two have been closely monitored since the king shouted: Why don't you shut up? at Chavez after the Venezuelan leader called former Spanish Prime Minister Jose Maria Aznar a fascist at an Iberian-American Summit in 2007.

Footage of the outburst was broadcast around the world and became hugely popular. The two leaders officially made up at the Spanish royals' summer residence on the island of Mallorca in July 2008.

Spain is a major investor in Venezuela and a visit by Spanish Foreign minister Miguel Angel Moratinos with a group of business leaders in July sealed agreements worth hundreds of millions of dollars.

On Friday Chavez also met Antonio Brufau, chairman of Spanish-Argentine oil major Repsol YPF, which has investments in Venezuela and sold $188 million of assets to its national oil company PDVSA in July.

(Reporting by Emma Pinedo; writing by Jonathan Gleave; editing by Andrew Roche)