CK Hutchison says may invite ‘major strategic investor' from China to join mega ports deal
HONG KONG – CK Hutchison Holdings said it may invite a 'major strategic investor' from China to join the buyer consortium in its plan to sell 43 ports, as investors regain confidence for the company's prospects of completing the troubled transaction.
The unnamed investor would join as a significant member of the consortium, the company said in a stock exchange filing on July 28.
'Changes to the membership of the consortium and the structure of the transaction will be needed for the transaction to be capable of being approved by all relevant authorities,' CK Hutchison said, adding that it 'intends to allow such time as is required for such discussions.'
Shares of the firm, which oscillated between gains and losses since the company first announced the deal on March 4, reached the highest this year on Friday (July 25) after Bloomberg News reported that state-owned China Cosco Shipping is set to join the buyer consortium that includes US asset manager BlackRock.
Although a 145-day exclusivity window for talks between CK Hutchison and the original buyers' group lapsed on July 27, the company's confirmation that a Chinese investor will join is likely to boost expectations.
Beijing has so far viewed the deal as a threat to its interests because it would transfer two ports along the strategically important Panama Canal to the BlackRock-backed group, which China sees as a proxy for American influence. US President Donald Trump hailing the transaction as a win for the United States did not help.
'Ongoing negotiations and the reported inclusion of Cosco Shipping in the consortium have likely eased concerns over Chinese regulatory hurdles, strengthening investor confidence in the deal's viability,' according to Bloomberg Intelligence analyst Denise Wong.
Top stories
Swipe. Select. Stay informed.
Singapore Not feasible for S'pore to avoid net‑zero; all options to cut energy emissions on table: Tan See Leng
Singapore With regional interest in nuclear energy rising, S'pore must build capabilities too: Tan See Leng
Singapore Sewage shaft failure linked to sinkhole; PUB calling safety time-out on similar works islandwide
Singapore Workers used nylon rope to rescue driver of car that fell into Tanjong Katong Road sinkhole
Singapore New Mandai North Crematorium, ash-scattering garden to open on Aug 15
World Three dead, several injured after train derails in Germany
World US and EU clinch deal with broad 15% tariffs on EU goods to avert trade war
Asia Displaced villagers at Thai-Cambodian border hope to go home as leaders set to meet for talks
China separately warned the parties involved not to bypass antitrust reviews, so as to prevent them from rushing into a deal. As of last week, the buyers' group was considering China Cosco's demand for veto rights to secure Beijing's interests, Bloomberg News reported.
CK Hutchison's shares, which shot up 37 per cent in the days following the sale announcement in March, saw political pressure wipe out all the gains in the space of a month. The stock started rallying again in June as investors flocked back after China Cosco came into play.
The share price recovery shows investors are increasingly betting on Li Ka-shing, the 96-year-old founder of CK Hutchison, to seal the deal of his lifetime. If it goes through, the sale will net the group more than US$19 billion (S$24.3 billion) in cash. The renewed optimism is largely due to China Cosco's interest in playing a role in the buying consortium, alongside BlackRock and Italian billionaire Gianluigi Aponte's Terminal Investment.
Challenges remain even as Cosco enters the discussions, David Blennerhassett, an analyst at Quiddity Advisors, wrote on financial analysis platform SmartKarma. That could reverse the current rhetoric and upset Mr Trump, who has a handful of issues already on his plate, he said. CK Hutchison's share price could also be under pressure should talks on the sale drag on, he added.
Investors will be watching out for more answers to questions surrounding the deal, including what role the Chinese side will play in the consortium, said Gary Ng, a senior economist at Natixis.
The controversial deal has also weighed on Mr Li and his family's other businesses. Younger son Richard's talks to expand his insurance business into mainland China have stalled after the ports deal upset Beijing, Bloomberg reported earlier in July. That followed another Bloomberg report in March that China told its state-owned firms to hold off on any new collaboration with businesses linked to the Li family.
The original structure of the buyer consortium was designed to give the Aponte family-controlled Terminal Investment ownership of all the ports except the two in Panama, whose control will go to BlackRock's Global Infrastructure Partners unit. BLOOMBERG
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Straits Times
9 minutes ago
- Straits Times
Trump's deal-making with other elite US schools scrambles Harvard negotiations
Sign up now: Get ST's newsletters delivered to your inbox WASHINGTON – By the start of last week, Harvard University had signalled its readiness to meet President Donald Trump's demand that it spend US$500 million (S$643 million) to settle its damaging, monthslong battle with the administration and restore its crucial research funding. Then, two days after The New York Times reported that Harvard was open to such a financial commitment, the White House announced a far cheaper deal with Brown University: US$50 million, doled out over a decade, to bolster state workforce development programs. The terms stunned officials at Harvard, who marvelled that another Ivy League school got away with paying so little, according to three people familiar with the deliberations. But Harvard officials also bristled over how their university, after months of work to address antisemitism on campus and with a seeming advantage in its court fight against the government, was facing a demand from Mr Trump to pay 10 times more. The people who discussed the deliberations spoke on the condition of anonymity because they did not want to be identified discussing talks that are supposed to remain confidential. White House officials are dismissive of the comparison between Brown and Harvard, arguing that their grievances against Harvard are more far-reaching, including assertions that the school has yet to do enough to ensure the safety of Jewish students and their claim that the school is flouting the Supreme Court's ruling on race-conscious admissions. 'If Harvard wants the Brown deal, then it has to be like Brown, and I just think it's not,' Ms May Mailman, the top White House official under Mr Stephen Miller who has served as the architect of the administration's crusade against top schools, said in an interview in the West Wing last week. Ms Mailman, who graduated from Harvard Law School, pointed out that Brown, unlike Harvard, did not sue the administration. She challenged Harvard to reach an agreement that included terms that would allow the government to more closely scrutinise its behaviour. 'If Harvard feels really good about what it's already doing, then great,' she said. 'Let's sign this deal tomorrow.' Harvard said on Aug 4 that it had no comment. But the White House's recent record of deal-making threatens to complicate the settlement talks, according to the people familiar with the talks. University officials were sensitive to the possibility that a deal with the government – after Harvard spent months waging a public fight against Mr Trump – would be seen as surrendering to the president and offering him a political gift. The terms of the Brown agreement, though, added new complexity to Harvard's internal debates about the size of a potential financial settlement. For many people close to those discussions, spending US$500 million is less of a concern than what forking that money over would signal on the Cambridge, Massachusetts, campus and beyond. For those close to the discussions, Mr Trump's demand is far too large and they argue that acquiescing to it would be seen as the university scrambling to buy its way out of Mr Trump's ire. They contend that Harvard has taken far more aggressive steps than Columbia University – which agreed to a US$200 million fine in July – to combat antisemitism. They also note that Harvard, unlike Brown, did not publicly agree to consider divesting from Israel as a condition of ending campus protests lin 2024. (Brown's board ultimately voted not to divest.) Others at Harvard regard Mr Trump's proposal as a bargain for the school to get back billions of dollars in funding that make much of its society-shaping research possible. Before the Brown deal, Harvard leaders and the school's team were studying settlement structures that could insulate the nation's oldest and wealthiest university from accusations that it caved to Mr Trump. In their stop-and-start talks with the White House, they are expected to maintain their insistence on steps to shield the university's academic freedom. To that end, they are also likely to remain equally resistant to a monitoring arrangement that some fear would invite intrusions and stifle the school's autonomy. But Harvard has been exploring a structure in which any money the university agrees to spend will go to vocational and workforce training programs instead of the federal government, Mr Trump, his presidential library or allies, according to the three people briefed on the matter. Harvard officials believe that such an arrangement would allow them to argue to their students, faculty, alumni and others in academia that the funds would not be used to fill Mr Trump's coffers. Harvard's consideration of putting money toward workforce programmes aligns with some of what Mr Trump has espoused. In a social media post in May, the president talked up the prospect of taking US$3 billion from Harvard and 'giving it to TRADE SCHOOLS all across our land. What a great investment that would be for the USA, and so badly needed!!!' But no matter the structure, White House officials have made clear that an extraordinary sum will be required to reach a settlement. Last week, after the Times reported the US$500 million figure, a journalist asked Mr Trump whether that amount would be enough to reach a deal. 'Well, it's a lot of money,' he replied. 'We're negotiating with Harvard.' Although Brown and Harvard are among the nation's richest and most prominent universities, the schools have significant differences, especially around their finances. The Trump administration has repeatedly castigated Harvard for its US$53 billion endowment, which is loaded with restrictions that limit how it may be used, but it has made far less fuss about Brown's similarly tied-up US$7 billion fund. Harvard also has much more federal research money at stake. The Trump administration has warned that it could ultimately strip US$9 billion in funding for Harvard; it threatened US$510 million in funding for Brown. One reason the Brown deal has so miffed Harvard officials is that some terms look much like those they expected for themselves. The government agreed, for instance, that it could not use the deal 'to dictate Brown's curriculum or the content of academic speech.' Brown avoided a monitoring arrangement, and the university won the right to direct its US$50 million settlement payment toward workforce programmes of its choosing. But Harvard has a more antagonistic relationship with the Trump administration, as the university has sued the administration to stop its retribution campaign against the school. That dynamic has fuelled worries at Harvard that the White House is seeking a far higher financial penalty as a punishment for fighting, not because the school's troubles alone warrant US$500 million. After Harvard refused a list of Trump administration demands in April, the university sued. In July, a federal judge in Boston appeared skeptical of the government's tactics when it blocked billions in research funding from Harvard. Before and after the July 21 hearing, the administration pursued a wide-ranging campaign against the university. In addition to its attack on Harvard's research money, the government has opened investigations, sought to block the school from enrolling international students, demanded thousands of documents and tried to challenge the university's accreditation, which is essential for students to be eligible for federal student aid programmes, such as Pell Grants. Last week, the Department of Health and Human Services told Harvard that it had referred the university to the Justice Department 'to initiate appropriate proceedings to address Harvard's antisemitic discrimination.' 'Rather than voluntarily comply with its obligations under Title VI, Harvard has chosen scorched-earth litigation against the federal government,' Ms Paula Stannard, the director of the health department's Office for Civil Rights, wrote on July 31, referring to the section of federal civil rights law that bars discrimination on the basis of race, colour or national origin. 'The parties' several months' engagement has been fruitless.' As Harvard President Alan Garber and other university leaders face the White House's fury, they are also confronting campus-level misgivings about a potential deal with a president many at the school see as bent on authoritarianism. At best, many at Harvard view him as duplicitous and believe it would be risky for the university to enter a long-term arrangement. 'I think even the simplest deals with untrustworthy people can be challenging,' said Professor Oliver Hart, an economics professor at Harvard who won a Nobel Prize for his work on contract theory. 'But a continuing relationship is much, much worse, much harder.' Prof Hart warned that, no matter the written terms of a settlement, the federal government would retain enormous power with effectively limitless financial resources to take on Harvard. Ms Mailman, who recently left the full-time White House staff but remains involved in the administration's higher-education strategy, all but dared Harvard to stay defiant. 'I think there's still a deal to be had, but from our perspective, at the end of the day, Harvard has a US$53 billion endowment,' she said. 'They don't need federal funds. And even if they win a lawsuit, great. But what happens next year? What happens the year after?' NYTIMES
AsiaOne
9 minutes ago
- AsiaOne
Trump again threatens India with harsh tariffs over Russian oil purchases, World News
WASHINGTON — US President Donald Trump again threatened on Monday (Aug 4) to raise tariffs on goods from India over its Russian oil purchases, while New Delhi called his attack "unjustified" and vowed to protect its economic interests, deepening the trade rift between the two countries. In a social media post, Trump wrote, "India is not only buying massive amounts of Russian Oil, they are then, for much of the Oil purchased, selling it on the Open Market for big profits. They don't care how many people in Ukraine are being killed by the Russian War Machine." "Because of this, I will be substantially raising the Tariff paid by India to the USA," he added. A spokesperson for India's foreign ministry said in response that India will "take all necessary measures to safeguard its national interests and economic security." "The targeting of India is unjustified and unreasonable," the spokesperson added. Trump has said that from Friday he will impose new sanctions on Russia as well as on countries that buy its energy exports, unless Moscow takes steps to end its 3-1/2 year war with Ukraine. Russian President Vladimir Putin has shown no public sign of altering his stance despite the deadline. Over the weekend, two Indian government sources told Reuters that India will keep purchasing oil from Russia despite Trump's threats. India has faced pressure from the West to distance itself from Moscow since Russia invaded Ukraine in early 2022. New Delhi has resisted, citing its longstanding ties with Russia and economic needs. Trump had already in July announced 25 per cent tariffs on Indian imports, and US officials have cited a range of geopolitical issues standing in the way of a US-India trade accord. Trump has also cast the wider BRICS group of developing nations as hostile to the United States. Those nations have dismissed his accusation, saying the group promotes the interests of its members and of developing countries at large. Crude buyer India is the biggest buyer of seaborne crude from Russia, importing about 1.75 million barrels per day of Russian oil from January to June this year, up 1 per cent from a year ago, according to data provided to Reuters by trade sources. [[nid:720925]] India began importing oil from Russia because traditional supplies were diverted to Europe after the outbreak of the Ukraine conflict, the Indian spokesperson said, calling it a "necessity compelled by global market situation." The spokesperson also noted the West's, particularly the European Union's, bilateral trade with Russia: "It is revealing that the very nations criticising India are themselves indulging in trade with Russia." Despite the Indian government's defiance, the country's main refiners paused buying Russian oil last week, sources told Reuters. Discounts to other suppliers narrowed after Trump threatened hefty tariffs on countries that make any such purchases. Indian government officials denied any policy change. The country's largest refiner, Indian Oil Corp, has bought seven million barrels of crude from the United States, Canada and the Middle East, four trade sources told Reuters on Monday. India also has been frustrated by Trump repeatedly taking credit for an India-Pakistan ceasefire that he announced on social media in May, which halted days of hostilities between the nuclear-armed neighbours. The unpredictability of the Trump administration creates a challenge for Delhi, said Richard Rossow, head of the India programme at Washington's Centre for Strategic and International Studies. "India's continued energy and defence purchases from Russia presents a larger challenge, where India does not feel it can predict how the Trump administration will approach Russia from month to month," he said. [[nid:720581]]
AsiaOne
9 minutes ago
- AsiaOne
Zelenskiy says 'mercenaries' from China, Pakistan and other countries fighting for Russia, World News
KYIV — President Volodymyr Zelenskiy said on Monday (Aug 4) that Ukrainian troops in northeastern Ukraine were fighting foreign "mercenaries" from various countries including China, Pakistan and parts of Africa, and vowed a response. Zelenskiy has previously accused Moscow of recruiting Chinese fighters for its war effort against Ukraine, charges Beijing denied, while North Korea has also provided thousands of its own troops in Russia's Kursk region. "We spoke with commanders about the frontline situation, the defence of Vovchansk, and the dynamics of the battles," Zelenskiy wrote on X after visiting a frontline area in the northeastern Kharkiv region. "Our warriors in this sector are reporting the participation of mercenaries from China, Tajikistan, Uzbekistan, Pakistan, and African countries in the war. We will respond." Reuters contacted the embassies of Tajikistan, Uzbekistan and Pakistan in Kyiv to request comment. Russia did not immediately comment publicly on Zelenskiy's comments. [[nid:720860]]
