- China has threatened to block a $22.8 billion global ports deal unless its shipping giant Cosco is given a stake.
- The deal must be revised to include Cosco before the July 27 deadline.
- The agreement is drawing geopolitical attention, with both China and the U.S. viewing it as strategically significant.
China is threatening to block the sale of more than 40 ports, owned by Hong Kong-based CK Hutchison, to BlackRock and MediteAAACrranean Shipping Company (MSC) if Chinese shipping company Cosco does not get a stake, reports Reuters.
China Threatens to Sink $22.8B Ports Deal
CK Hutchison, MSC, BlackRock and Cosco did not immediately respond to Reuters’ requests for a comment, while the Chinese government could not be immediately reached outside office hours.
Chinese officials have told BlackRock, MSC and Hutchison that if Cosco is left out of the deal, Beijing would take steps to block Hutchison’s proposed sale of the ports, the newspaper said.
Tycoon Li Ka-shing’s CK Hutchison in March announced it would sell its 80% holding in the ports business, which encompasses 43 ports in 23 countries. The business has an enterprise value of $22.8 billion, including debt.
After much scrutiny and criticism in China, Hong Kong conglomerate CK Hutchison confirmed in May Italian billionaire Gianluigi Aponte’s family-run MSC, one of the world’s top container shipping groups, was the main investor in a group seeking to buy the ports.
BlackRock, MSC and Hutchison all are open to Cosco taking a stake, WSJ said.
However, the parties would likely not reach a deal before a previously agreed upon July 27 deadline for exclusive talks between BlackRock, MSC and Hutchison, the report added.
The proposed sale has also drawn the attention of U.S. President Donald Trump, who has repeatedly expressed his desire to reduce Chinese influence around the Panama Canal and termed the deal a “reclaiming” of the waterway after it was first announced.
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Source: Reuters
