China says CK Hutchison's ports deal must not try to avoid antitrust review
[BEIJING] China's top market regulator said on Sunday (Apr 27) that it was paying close attention to CK Hutchison's planned sale of most of its ports operations to a BlackRock-led consortium and parties to the deal should not try to avoid an antitrust review.
The sale by the Hong Kong conglomerate, which contains two ports along the strategically important Panama Canal, has become highly politicised amid intensifying US-Sino trade tensions.
'No concentration of undertakings shall be implemented without approval, otherwise legal liability will be incurred,' the State Administration for Market Regulation said in a statement.
The statement was in response to a Wall Street Journal article on Apr 16. The MSC shipping empire, which is part of the BlackRock consortium, has held discussions on moving ahead with the bulk of the deal while disputes over the two Panama ports are resolved, the report said, citing people familiar with the matter.
The deal has two components with different ownership structures – one for the Panama ports and one for everything else, the report added.
US President Donald Trump has repeatedly said that he wants to take back the Panama Canal and has hailed the deal as a 'reclaiming' of the waterway. Chinese state media, however, have criticised the planned sale as a betrayal of China's interests.
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Trump said on Saturday that American military and commercial ships should be allowed to travel through the Panama Canal and Suez Canal free of charge.
Tycoon Li Ka-shing's CK Hutchison announced last month it would sell its 80 per cent holding in the ports business which encompasses 43 ports in 23 countries. The business has an enterprise value, which includes debt, of US$22.8 billion.
Singapore's PSA International, which owns the other 20 per cent, is also exploring a sale of its holding, sources have said.
Overall, the Hong Kong conglomerate has interests in 53 ports. Ports in Hong Kong and mainland China were not included in the deal. REUTERS
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