Shares in Hong Kong-based conglomerate CK Hutchison dropped sharply on Friday after Beijing criticised its decision to sell part of its stake in Panama Ports Co (PPC).
The stock fell more than 6% after China said Hutchison should “think twice” about the $22.8bn deal with asset manager BlackRock, the Financial Times reported.
Hutchison’s move to sell came after strong criticism from US President Donald Trump over the extent of China’s control over the critical waterway.
But this week the condemnation came from China.
A strongly worded opinion column in Beijing-backed newspaper Ta Kung Pao denounced the US pressure campaign and “a spineless, grovelling profit-seeking move that sells one’s integrity for personal gains, and an act that disregards national interests … [which] betrays and sells out all Chinese people”.
Hutchison should “think twice” about “what position and side they should be on”, said the column, which was later republished by a Chinese government office.
The FT cited concerns over whether the deal would now go forward after Friday’s share slide, although it also quoted an analyst who suggested the downturn may reflect an overreaction.
Dan Baker, a senior equity analyst at Morningstar, said: “To the extent that the company still has assets in China, if the Chinese government is still upset with them for making this sale, there is probably some potential investor concern about what might happen to their businesses that are still there.”
Hutchison’s shares had soared more than 20% in Hong Kong at the deal’s announcement.
The consortium of BlackRock’s Global Infrastructure Partners and MSC Group’s terminal unit will buy the 90% stake in PPC that is controlled by CK Hutchison, as well as its 80% control over 43 other ports in 23 countries.
US secretary of state Marco Rubio claimed Hutchison’s ownership helped give Beijing effective control over the Panama Canal. Panamanian officials rejected those claims but launched an audit of the ports company.
The Panamanian portion of the transaction will require approval from the country’s government. Definitive documentation is expected to be signed by 2 April.
The other tranche of the deal involves the ports of Hutchison Port Holdings, excluding those in Hong Kong and mainland China.
