- CK Hutchison port sale sparks political tension.
- Disputes emerge over Panama ports in the deal.
- The sale is structured separately for Panama assets.
China’s market regulator at the highest level stated on Sunday that it was closely following CK Hutchison’s (0001.HK) proposed sale of the majority of its ports business to a consortium led by BlackRock. It underlined the fact that the parties to the transaction cannot attempt to circumvent an antitrust check, reports Reuters.
Deal Draws Political Scrutiny Amid U.S.-China Tensions
“No concentration of undertakings shall be implemented without approval, otherwise legal liability will be incurred,” the State Administration for Market Regulation stated. The sale, involving two ports along the strategically important Panama Canal, has become highly politicised against the backdrop of growing U.S.-China trade tensions. The regulator’s statement came in response to an April 16 Wall Street Journal article highlighting concerns about the deal’s progression.
BlackRock Consortium and Dispute Over Panama Ports
The Wall Street Journal reported that the MSC shipping empire owned by the BlackRock group has considered going ahead with most of the deal as disagreements over the two Panama ports are addressed. The report was quoted by people who are close to the negotiations.
Different Structures for Panama Ports and Other Assets
The deal is structured into two parts: one for the Panama ports and another for the rest of the global assets. This division mirrors the delicacy and intricacy of the Panama Canal facilities.
U.S. President Trump Celebrates the Deal
U.S. President Donald Trump welcomed the deal, calling it a strategic victory for America.
Trump stated that US military and merchant vessels should be permitted to transit the Panama Canal and Suez Canal” free of charge.” He also described the sale as a “reclaiming” of the Panama Canal.
Chinese Media Criticises the Sale
Chinese state media have denounced the proposed sale, calling it a betrayal of China’s strategic interests. The backlash highlights the broader geopolitical undertones surrounding the deal.
Facts of the CK Hutchison Ports Sale
Billionaire Li Ka-shing’s CK Hutchison last month said it will sell its 80% interest in the ports business, covering 43 ports in 23 nations. The business has a value of $22.8 billion when including debt.
PSA International Also Eyeing Sale of Its Stake
Singapore’s PSA International, which has the other 20% of the ports business under its belt, is also said to be looking at a sale of its stake, people with knowledge of the situation say. In all, CK Hutchison has holdings in 53 ports globally. But Hong Kong and mainland Chinese ports are not included in the transaction.
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Source: Reuters
