A Hong Kong-based logistics giant has agreed to sell a 90% stake in its business amid Donald Trump’s vows to take back the canal
A Hong Kong-based company has announced plans to sell a controlling stake in a business operating two major ports on the Panama Canal to a consortium of investors led by an American multinational. The deal comes amid mounting pressure from US President Donald Trump over alleged Chinese influence on the crucial waterway.
Addressing a special joint session of the two chambers of the US Congress on Tuesday, the US president claimed he is making a successful diplomatic push to reclaim the Panama Canal, which he describes as a vital infrastructure project created by Americans for Americans.
Asian logistics giant CK Hutchison Holdings will sell a 90% interest in Panama Ports Company to a consortium that includes US investment holding BlackRock, its subsidiary Global Infrastructure Partners, and Geneva-based container terminals major Terminal Investment, according to a joint statement issued by CK Hutchison and BlackRock on Tuesday.
Panama Ports Company holds the contract to run the ports of Balboa and Cristobal, located at the Pacific and Atlantic entrances of the canal respectively, until 2047.
The deal also covers the sale of an 80% stake of CK Hutchison’s ports subsidiaries operating 43 ports across 23 countries, including in the UK, Germany, Mexico, Australia, Argentina, and South Korea.
According to the statement, the agreement, valued at nearly $23 billion, including $5 billion in debt, does not have any interest in a trust that “operates ports in Hong Kong, Shenzhen and South China, or any other ports in China.”
Shares of CK Hutchison, the market capitalization of which amounts to HK$148 billion ($19 billion) soared 22% in morning trading in Hong Kong on Wednesday.
Trump has repeatedly threatened to take back control of the Panama Canal, citing “ridiculous fees” and concerns over China’s growing influence around the waterway, which was built by the US in the early 20th century and handed over to Panama in 1999.
In February, Panamanian President Jose Raul Mulino made a concession to Washington by refusing to renew the country’s 2017 agreements with China under Beijing’s Belt and Road Initiative.
