Shares in CK Hutchison soared 25 percent in Hong Kong on Wednesday after it agreed to sell its lucrative Panama Canal ports to a US-led consortium under fierce pressure from US President Donald Trump.
The firm owned by Hong Kong billionaire Li Ka-shing saw its stocks rise 22.9 percent to HK$47.50 at around 0230 GMT after earlier reaching 25 percent higher on the Hong Kong exchange, reports BSS.
Hutchison subsidiary Panama Ports Company (PPC) has for decades run ports at Balboa and Cristobal on the Pacific and Atlantic ends of the interoceanic waterway.
However, Trump has complained since taking office in January that China controls the canal — a vital strategic asset that the United States once ran.
Trump refused to rule out a military invasion of Panama to regain control, sparking angry protests and a complaint to the United Nations by the Central American nation.
CK Hutchison Holdings said on Tuesday it would offload a 90-percent stake in PPC and sell a slew of other non-Chinese ports to a group led by giant asset manager BlackRock.
The sellers will receive $19 billion in cash, the company said.
Hutchison said in a joint news release with the buyers that the deal was 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,” co-managing director Frank Sixt said.
CK Hutchison Holdings is one of Hong Kong’s largest conglomerates, spanning finance, retail, infrastructure, telecoms and logistics.
Bloomberg Intelligence analyst Denise Wong said “the deal will remove business uncertainty for CK Hutchison and offer… proceeds for them to hunt for new M&A opportunities”.
“The company is well positioned to replenish its portfolio with assets that are less prone to geopolitical tensions given a diversified global business with strong expertise spanning the retail, telecom and utilities space, among others,” she said.
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