CK Hutchison Holdings' plan to sell the bulk of its global ports operations to a consortium led by BlackRock is causing concern, according to Hong Kong’s leader.
“There have been extensive discussions in society about the issue,” John Lee said at his weekly press briefing in response to questions on the sale. “This reflects society’s concern over the matter. These concerns deserve serious attention.”
His remarks echo those in a commentary published by Beijing-backed Ta Kung Pao newspaper, which said the deal triggered deep concerns among Chinese people and raised questions over whether the deal harms the country. The commentary was reposted by China’s top office on Hong Kong affairs over the weekend.
“The Hong Kong SAR government urges foreign governments to provide a fair and just environment for enterprises, including enterprises from Hong Kong,” Lee said. “We oppose the abusive use of coercion or bullying tactics in international economic and trade relations.”
Under pressure from the Trump administration over two ports at the Panama Canal controlled by CK Hutchison, owned by billionaire Li Ka-shing, on March 4 announced a plan to sell 43 ports in 23 countries. CK Hutchison will pocket more than $19 billion in cash proceeds.
Before the agreement was announced, U.S. President Donald Trump argued that China had taken over the Panama waterway, without providing evidence, and that the U.S. was paying too much for the passage of ships.
An earlier Ta Kung Pao opinion piece, which was also posted on the Hong Kong and Macau Affairs Office’s website, called on companies to be careful about which “side they should stand on.” It said social media users had accused CK Hutchison of “spineless groveling” and “selling out” Chinese people.
“Any transaction must comply with the legal and regulatory requirements,” Lee said, adding that the government will handle the deal “in accordance with the law and regulations.”
Despite being closely associated with Hong Kong, CK Hutchison is registered in the Cayman Islands — a move carried out in 2015 as part of a group-wide restructuring. The company gets almost 90% of its revenue from outside of mainland China and Hong Kong.
While the stock surged 33% in the two days after the deal was announced, it’s since pared that gain to 21% as criticism mounted.
