Under fierce pressure from US President Donald Trump, the Hong Kong firm Hutchison said it had agreed to sell its lucrative Panama Canal ports to a US-led consortium on Tuesday.
Under fierce pressure from US President Donald Trump, the Hong Kong firm Hutchison said it had agreed to sell its lucrative Panama Canal ports to a US-led consortium on Tuesday. CK Hutchison Holdings said it would offload a 90 percent stake in Panama Ports Company, and sell a slew of other non-Chinese ports to a group led by giant asset manager BlackRock.
The purchase price of the transaction is $14.2 billion and it will net sellers more than $19 billion in cash, CK said in a news release. Hutchison has for decades run ports at Balboa and Cristobal -- on the Pacific and Atlantic ends of the interoceanic waterway. But since coming to office in January, Trump has complained that China controls the canal -- a vital strategic asset that the US once ran. Trump even refused to rule out a military invasion of Panama to regain control, sparking angry protests in the Central American nation. In a joint press release with the buyers, Hutchison described the deal as motivated by business, not politics. "I would like to stress that the transaction is purely commercial in nature and wholly unrelated to recent political news reports concerning the Panama Ports," said CK's co-managing director Frank Sixt. "This transaction is the result of a rapid, discrete but competitive process in which numerous bids and expressions of interest were received," said Sixt, who described the chosen agreement as"clearly in the best interests of shareholders." BlackRock CEO Larry Fink said the transaction demonstrated his consortium's capacity to"deliver differentiated investments for clients," according to the press release.The announcement is composed of transactions between the parties, one related to the Panama Ports Company and the other to Hutchison's other holdings, 43 ports comprising 199 berths in 23 countries.In February, Marco Rubio visited Panama during his first overseas trip as secretary of state, proof of the canal's importance to the new administration. Rubio won a commitment from Panamanian President Jose Raul Mulino's to exit the Belt and Road Initiative, China's signature infrastructure-building program. Rubio also pressed for free passage of US vessels through the Panama Canal, after telling Panamanian officials that it was unfair for the United States to be in a position to defend the vital waterway and also to be charged for its use. Since 2000 the Panama Canal Authority, a Panamanian government agency, has run the canal and successfully upgraded the more-than-century-old waterways and locks to handle ever-larger vessels.China's leadership convenes next week for closed-door meetings to hammer out plans to shield the ailing economy from tariffs and trade threats from ...
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