Questions about CK Hutchison's port, including two ports adjacent to the Panama Canal, have risen after Beijing denounced the sale as a betrayal of China.
On Friday, the Hong Kong and Macau Affairs Office of China (HKMAO) reposted a comment, criticizing the deal, and shares of CK and Hutchison on the Hong Kong Stock Exchange fell 6.4%.
The reintroduction of critical state media comments by Chinese governing bodies overseeing the territory highlights the complex geopolitical pressures facing the company as investors fear the deal could derail without Beijing’s support.
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Hutchison said last week Agree to sell most of the global port operations of $22.8 billionincluding its strategically important assets Panama Canala group led by BlackRock.
The consortium will control a total of 43 ports in 23 countries. U.S. President Donald Trump has called for the removal of the waterway from what he calls China's ownership and praised the deal.
“Politics of Power” packaged as “Commercial”
On Thursday, the Hong Kong-based Ta Kung Letter newspaper published a comment saying the deal “betrayed and sold the entire Chinese”, neglecting national interests and showing that CK Hutchison was seeking profits.
The comment reposted on HKMAO's website, he said the U.S. will restrict China's maritime trade and Chinese companies will face huge risks in logistics and supply chains, affecting China's belt and road initiatives.
The comment read: “This deal is a hegemonic act of the United States that uses its state power to infringe on the legitimate rights and interests of other countries through despicable means such as coercion, pressure and inducement.”
“This is power politics packaged as 'business'.”
CK Hutchison and HKMAO did not immediately respond to requests for comment.
Shares of CK and Hutchison fell, with benchmark Heng Sang Index rising 2.1%.
CK Hutchison, a Hong Kong-founded and listed company owned by billionaire Li Ka-Shing, has an independent business in China.
But Hong Kong's advantages as an international financial center will further erode as geopolitical tensions squeezed by executives and analysts Already said.
Shipping company transfers from Hong Kong
Some shipping companies are removing operations from Hong Kong and removing ships from their flag registrations, Reuters Report Earlier this month.
Meanwhile, Trump is planning Executive Order Charge fees for Chinese connecting vessels at U.S. ports to restore U.S. shipbuilding and destroying China's supply chains.
Vera Yuen, a lecturer at the University of Hong Kong Business School, said the comments were “a manifestation of political risks and a warning lesson for companies that want to do business with both parties.
“You can't do it at the same time,” she said.
This is not the first time that Li Billionaire has appeared in the crosshair in Beijing. In 2015, Chinese media commented criticized him for selling his assets widely when the country was in a tight economy, criticizing him for giving up on China.
According to a statement, while CK and Hutchison agreed to exclusively negotiate with the BlackRock consortium, the deal has not yet been terminated.
“The risk of the deal has increased,” said Thomas Kwok, the principal head of securities equity. “CKH is now arrested in the middle; if not sold, it will continue to be troubled by the United States; but if sold, it will upset Beijing.
“We need to be aware that this will lead to CKH to where it is now; if the Panama port is to be retained through litigation, they will need to communicate with Beijing.”
- Jim Pollard's additional editor Reuters
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