Beijing may halt the $22.8B CK Hutchison port sale to BlackRock & MSC if COSCO isn’t given a stake, reports WSJ.
In a high-stakes geopolitical and commercial standoff, China has reportedly warned that it may block a $22.8 billion global port sale by CK Hutchison unless Chinese shipping giant COSCO is granted a stake in the deal. According to a Wall Street Journal report citing unnamed sources, Beijing has made it clear to BlackRock, MSC, and CK Hutchison that the proposed transaction will not move forward without COSCO’s involvement.
The transaction involves the sale of CK Hutchison’s port assets, comprising 43 ports across 23 countries, to a consortium led by BlackRock and the Mediterranean Shipping Company (MSC). The move had already stirred global attention, not least due to the strategic locations of several of the ports, including those near the Panama Canal.
Chinese officials have reportedly conveyed that excluding COSCO would trigger government intervention, jeopardising the entire sale. CK Hutchison, BlackRock, MSC, and COSCO have so far not commented publicly on the report. When asked about the development, China’s Foreign Ministry reiterated its opposition to “economic coercion, hegemony, bullying, and infringement of other countries’ rights,” but did not directly confirm the threat.
The port sale, originally announced in March, includes CK Hutchison’s 80% holding in its international ports business. By May, the Hong Kong-based conglomerate confirmed MSC, owned by Italian billionaire Gianluigi Aponte’s family, as the primary investor leading the acquisition talks.
While all parties reportedly remain open to COSCO joining the deal, it appears unlikely that an agreement will be reached before the exclusivity deadline of July 27 for negotiations between BlackRock, MSC, and Hutchison.
The deal has also attracted political scrutiny from the United States. U.S. President Donald Trump has labelled the sale as a “reclaiming” of the Panama Canal region and expressed strong opposition to increasing Chinese influence in such a vital maritime corridor.
With the deadline looming and pressure mounting from Beijing, the next few days could determine whether one of the most significant port transactions in recent history proceeds or gets derailed by geopolitics.
Source: Reuters
