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China threatens to stop Panama ports deal unless it gets a stake in its shipping giant, WSJ reports

The Wall Street Journal, citing anonymous sources, reported that China threatened to block the sale to BlackRock and Mediterranean Shipping Company of more than forty ports owned by Hong Kong's CK Hutchison.

Could not verify immediately the WSJ article.

CK Hutchison and MSC did not respond immediately to requests for a statement, and the Chinese government was not reachable outside of office hours.

The newspaper reported that Chinese officials told BlackRock MSC and Hutchison, if Cosco was not included in the deal, Beijing will take action to stop Hutchison from selling the ports.

CK Hutchison, owned by Li Ka-shing, announced in March that it would be selling its 80% stake in the port business. This includes 43 ports across 23 countries. The enterprise value, including debt, is $22.8 billion.

After much scrutiny in China and criticism, Hong Kong conglomerate CK Hutchison confirmed that Italian billionaire Gianluigi Aponte’s family-run MSC – one of the top container shipping companies in the world – was the principal investor in a bid to purchase the ports.

WSJ reported that BlackRock, MSC, and Hutchison are all open to Cosco acquiring a stake.

The report said that the parties were unlikely to reach an agreement before the previously agreed deadline of July 27 for exclusive discussions between BlackRock MSC and Hutchison.

After the announcement, Donald Trump called the proposed deal a "reclaiming of the waterway". Reporting by Angela Christy, Mrinmay dey in Bengaluru and Shinjini Ganuli.

(source: Reuters)