Sharp Chinese criticism of CK Hutchison Holdings’ sale of its port assets near the Panama Canal to a US-led consortium has thrown a potential wrench into the deal, with pressure piling up on the family of Hong Kong billionaire Li Ka-shing to rethink the divestment.
Analysts said the deal was not final yet due to pending conditions, but was not subject to the approval of Chinese regulators or authorities in Hong Kong. There were no major hurdles to its completion, as long as CK Hutchison wanted to proceed, they said.
Beijing’s top office for Hong Kong affairs on Thursday posted on its website a fiery article written by pro-China newspaper Ta Kung Pao, which denounced the sale as “grovelling” and “betrayal”.
In the US$23 billion sale, unveiled on March 4, CK Hutchison, a flagship unit of the Li family, would sell 80 per cent of Hutchison Port Group to a BlackRock-led consortium. The assets comprise 43 container ports in 23 countries, including a 90 per cent stake in two Panama ports that have been the target of US President Donald Trump’s ire. A Singaporean state-owned port authority, PSA International, owns the remaining 20 per cent of the group.
“It is a complex and large deal and is still pending confirmatory due diligence and regulatory approvals from where CK Hutchison’s ports are located,” Zerlina Zeng and Zoey Zhou from debt-research firm CreditSights said in a written reply to the Post.
“That said, all disposal targets are outside China/Hong Kong, and thus the deal is not subject to the approval of Chinese regulators or authorities in Hong Kong, other than complying with [bourse operator Hong Kong Exchanges and Clearing’s] listing rules.”
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