China Threatens to Block $23B Port Deal Without Cosco Stake: Report
Under the proposed sale, Hong Kong-based port operator CK Hutchison Holdings would hand ownership of more than 40 ports worldwide to a consortium including Mediterranean Shipping Company (MSC) and BlackRock.
More from Sourcing Journal
But according to a Thursday report from the Wall Street Journal, China wants to block the acquisition if its leading ocean carrier, Cosco Shipping, is not included in the deal.
The deal includes the ports of Balboa and Cristóbal in Panama, both of which sit on the opposite sides of the Panama Canal.
China has had the deal under antitrust review since March, delaying the official approval of the sale. The Panamanian government also still needs to approve the acquisition.
The Chinese Communist Party (CCP) is pushing for Cosco to be an equal partner and shareholder of the ports alongside both BlackRock and MSC, which is the world's largest container shipping company, the report said.
Talks between the current parties in the deal are expected to continue through July 27, which is the end of the 145-day exclusive negotiation period. Cosco would not be able to be part of the talks until that period ends.
While BlackRock, MSC and Hutchison are reportedly open to Cosco taking a stake in the deal, U.S. lawmakers don't share the same feeling.
When the deal was first announced in March, it was seen as a major victory for the Trump administration, which has been seeking to rid the Panama Canal of any alleged Chinese influence.
The president has claimed that the U.S. must 'take back' the canal as part of his protectionist, 'America First' rhetoric, so including a Chinese buyer in the sale of the Balboa and Cristóbal ports would further inflame the situation again.
The U.S. congressional committee on China remains concerned as Cosco floats in the background of the mega ports deal.
After the Wall Street Journal article published Thursday, Chairman John Moolenaar (R-Mich.) of the House Select Committee on China made his letter to a top Panamanian official public.
The letter expresses alarm that CCP-directed entities could be included as part of a transaction involving port concessions managed by CK Hutchison, which Moolenaar said would pose a direct threat to the national security of both Panama and the U.S.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
24 minutes ago
- Yahoo
Carney's ministers say Hong Kong's new arrest warrants for exiles a threat to Canadians' security
Two ministers in Prime Minister Mark Carney's government are condemning Hong Kong police's new arrest warrants for 19 overseas-based activists and their offer of rewards for information leading to their capture. Officers have accused the activists of violating a national security law imposed by Beijing. In a joint statement Saturday afternoon, Foreign Affairs Minister Anita Anand and Public Safety Minister Gary Anandasangaree said "the actions taken by Hong Kong threaten the sovereignty of Canada and security of the people in this country." "This attempt by Hong Kong authorities to conduct transnational repression abroad, including by issuing threats, intimidation or coercion against Canadians or those in Canada, will not be tolerated." On Friday, a Hong King police statement said the group, called Hong Kong Parliament, aimed to promote self-determination and establish a "Hong Kong constitution," alleging it was using illegal means to overthrow and undermine China's fundamental system or overthrow the institutions in power in the city or China. At the request of police, the city's court issued arrest warrants for activists Elmer Yuen, Johnny Fok, Tony Choi, Victor Ho, Keung Ka-wai and 14 others. They are alleged to have organized or participated in an election abroad for the Hong Kong Parliament, as well as setting up or becoming members of the group. While the group calls itself Hong Kong Parliament, its electoral organizing committee was founded in Toronto in 2022 and its influence is limited. Anand and Anandasangaree said the people targeted by Hong Kong authorities "include Canadians and people with close ties to Canada." The ministers also said Canada reiterates previous calls to repeal the national security law and withdraw all related warrants and bounties. Ministers say bounties amplified online Among the 19 activists, police have already offered 1 million Hong Kong dollars ($174,580 Cdn) for information leading to the arrest of Yuen, Ho, Fok and Choi when warrants for separate activities were issued. For the remaining 15 people, rewards of 200,000 Hong Kong dollars ($34,915 Cdn) were offered, urging residents to provide information about the case or the people. WATCH l Victor Ho of B.C. was among 6 named in a previous announcement: Anand and Anandasangaree said this "marks the third time that international bounties were issued by Hong Kong and represents a deeply troubled escalation in the use of transnational repression by the People's Republic of China." In their statement, the ministers added that Rapid Response Mechanism Canada, which supports Canada's global push to counter foreign state-sponsored disinformation, detected the bounties were being amplified "in an inauthentic and co-ordinated way" through online accounts targeting Chinese-speaking communities. Hong Kong authorities have issued other arrest warrants over the past two years for various activists based overseas, including former pro-democracy lawmakers Nathan Law and Ted Hui.
Yahoo
2 hours ago
- Yahoo
Rising Fiscal Deficits Drive Billions Into Credit
(Bloomberg) -- Investors are showing signs of pulling money out of government bonds and plowing it into US and European company debt. Trump Awards $1.26 Billion Contract to Build Biggest Immigrant Detention Center in US The High Costs of Trump's 'Big Beautiful' New Car Loan Deduction Can This Bridge Ease the Troubled US-Canadian Relationship? Trump Administration Sues NYC Over Sanctuary City Policy If the moves persist, money managers could be shifting what for decades has been market orthodoxy: that nothing is safer than buying US government debt. But as US fiscal deficits climb, hurt by tax cuts and rising interest costs, the government may look to borrow more, and company debt may be the safer option. In June, money managers pulled $3.9 billion from Treasuries, while adding $10 billion to European and US investment-grade corporate debt, according to EPFR Global data. In July, investors have added another $13 billion to US high-grade corporates, the largest net client purchasing in data going back to 2015, according to a separate note from strategists at Barclays on Friday. Michaël Nizard, a portfolio manager at Edmond de Rothschild Asset Management, started making the switch from government into corporate debt at the end of last year and is holding on to the position. And in a note in the latest week, BlackRock Inc. strategists wrote, 'Credit has become a clear choice for quality.' To the extent this shift is happening, it's a slow change. The US doesn't have foreign currency debt, and can print more dollars as it needs to. When money managers were alarmed about tariff wars in April, US Treasuries still performed better than corporate bonds, even if prices for both sectors broadly fell. And foreign demand for Treasuries has remained resilient, with holdings climbing in May. But tightening corporate bond spreads in recent months may be a function of government debt looking relatively weaker now. The US government lost its last triple A grade in May, when Moody's Ratings cut it to Aa1. The bond rater pointed to factors including the widening deficit and the rising burden of interest, noting that payments will likely absorb around 30% of revenue by 2035, compared with 18% in 2024 and 9% in 2021. And US President Donald Trump's sweeping tax cut bill could add about $3.4 trillion to US deficits over the next decade, according to projections from the nonpartisan Congressional Budget Office. At the same time, corporate profits remain relatively strong, and although there are some early reasons for caution, high-grade companies are generally generating enough earnings to easily pay their interest now. More US companies are topping earnings estimates this reporting season than the same period last year. Valuations for company debt have been high recently, reflecting investor demand for the debt. High-grade US corporate spreads have averaged below 0.8 percentage point, or 80 basis points, in July through Thursday. That's far below the mean for the decade of about 120 basis points, according to Bloomberg index data. Spreads for euro-denominated high-grade corporates have averaged about 85 basis points in July, compared with about 123 basis points for the decade. To some money managers, high valuations for corporate credit are cause to be wary. Gershon Distenfeld, a fund manager at AllianceBernstein Holding LP, pared back a position that favored credit risk to rates risk earlier this month. Dominique Braeuninger, a multi-asset fund manager at Schroders Investment Management Ltd., agrees that corporate bond spreads are too tight to make them attractive. And even if BlackRock is generally positive on corporate debt, it is underweight long-term high-grade notes because spreads are tight, while being overweight short-term credit. But to many market observers, the world appears to be shifting, and it makes sense to hold more corporate debt now. 'What we've seen on the government fiscal side is not great news,' said Jason Simpson, a senior fixed income SPDR ETF strategist at State Street Investment Management. 'Corporates seem to be chugging along nicely.' Week In Review The US leveraged loan market saw more than $83 billion of launches in the latest week, the second busiest on record, including a $7.57 billion two-part deal from Medline that is set to be the market's biggest pricing since 2015. Repricings were an important driver of volume, representing about two thirds of the tranches, as companies look to cut borrowing costs. Many of the loans that were repriced had already been repriced before The return of billion-dollar M&A deals was supposed to be a boon for Wall Street's leveraged finance desks. It's turning out to be anything but, as private equity cuts them out of many of the most coveted deals. Lenders are demanding higher pricing from two European leveraged-loan borrowers, a rare sign of difficulty these days in the buoyant market for sub-investment grade debt. Chinese developer Country Garden Holdings Co. has agreed to some key restructuring terms a group of bank creditors had demanded, potentially easing the path for an overall debt deal. PepsiCo Inc. sold $4.7 billion of bonds in a pair of offerings that included the longest-dated euro-denominated corporate new issue since February. FedEx Corp. followed Pepsi with a rare two-part euro debt sale as some of its existing notes in the single currency near maturity. Meanwhile, General Electric Co. sold $2 billion of investment-grade bonds, as did Lockheed Martin Corp. Saks Global Enterprises launched a debt exchange after weeks of negotiations with creditors as its $600 million fresh financing takes shape. Separately, Walgreens Boots Alliance Inc. launched a multi-currency debt tender. Banks led by UBS Group and Citigroup have offloaded about $2 billion of debt to support Patient Square Capital's acquisition of Patterson Cos., reviving a deal more than three months after the bonds and loans got stuck on their books due to tariff turmoil in the market. Patterson received about $1 billion of orders for the $500 million junk-bond part of the sale. Dog walking service Wag! Group Co. won court permission to try to slash debt and hand control to senior creditor Retriever LLC as early as next month. On the Move Carlyle Group Inc. recruited Alex Chi, who was most recently co-head of Americas private credit at Goldman Sachs Group Inc.'s asset management arm, to lead its direct lending business. Chi will join Carlyle in early 2026. BMO Capital Markets hired Nii Dodoo as head of private credit financing. Dodoo joins from BTIG, where he was a managing director. Christina Chan, BNP Paribas' regional head of loan sales and head of corporate loan syndicate, Asia Pacific, has left the bank. Toronto-Dominion Bank's US credit trading unit has re-hired Sarah Classen from Goldman Sachs Group Inc. for its voice-trading business. Classen starts in mid-September as a director in TD Securities' global US dollar fixed income trading team, based in New York. Ares Management Corp. hired Sarah Cole as a partner and co-head of Ares Global Capital Solutions to bolster its partnerships with banks, insurance companies and across capital markets broadly. Hedge fund Squarepoint Capital LLP recruited Nathan Fabius, a former strategist at Goldman Sachs Group Inc., to cover Latin American debt. Fabius joined Squarepoint this month and is based in New York. Jefferies Financial Group Inc. plans to double the number of people on its credit secondaries team by the end of 2025, as demand has surged from investors who want to buy and sell existing exposure amid a dearth of fresh deals. Ardagh Group SA creditors are set to pay billionaire owner Paul Coulson as much as $300 million as part of a deal to hand over the keys to the company. Burning Man Is Burning Through Cash Confessions of a Laptop Farmer: How an American Helped North Korea's Wild Remote Worker Scheme It's Not Just Tokyo and Kyoto: Tourists Descend on Rural Japan Elon Musk's Empire Is Creaking Under the Strain of Elon Musk A Rebel Army Is Building a Rare-Earth Empire on China's Border ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 hours ago
- Yahoo
Rising Fiscal Deficits Drive Billions Into Credit
(Bloomberg) -- Investors are showing signs of pulling money out of government bonds and plowing it into US and European company debt. Trump Awards $1.26 Billion Contract to Build Biggest Immigrant Detention Center in US The High Costs of Trump's 'Big Beautiful' New Car Loan Deduction Can This Bridge Ease the Troubled US-Canadian Relationship? Trump Administration Sues NYC Over Sanctuary City Policy If the moves persist, money managers could be shifting what for decades has been market orthodoxy: that nothing is safer than buying US government debt. But as US fiscal deficits climb, hurt by tax cuts and rising interest costs, the government may look to borrow more, and company debt may be the safer option. In June, money managers pulled $3.9 billion from Treasuries, while adding $10 billion to European and US investment-grade corporate debt, according to EPFR Global data. In July, investors have added another $13 billion to US high-grade corporates, the largest net client purchasing in data going back to 2015, according to a separate note from strategists at Barclays on Friday. Michaël Nizard, a portfolio manager at Edmond de Rothschild Asset Management, started making the switch from government into corporate debt at the end of last year and is holding on to the position. And in a note in the latest week, BlackRock Inc. strategists wrote, 'Credit has become a clear choice for quality.' To the extent this shift is happening, it's a slow change. The US doesn't have foreign currency debt, and can print more dollars as it needs to. When money managers were alarmed about tariff wars in April, US Treasuries still performed better than corporate bonds, even if prices for both sectors broadly fell. And foreign demand for Treasuries has remained resilient, with holdings climbing in May. But tightening corporate bond spreads in recent months may be a function of government debt looking relatively weaker now. The US government lost its last triple A grade in May, when Moody's Ratings cut it to Aa1. The bond rater pointed to factors including the widening deficit and the rising burden of interest, noting that payments will likely absorb around 30% of revenue by 2035, compared with 18% in 2024 and 9% in 2021. And US President Donald Trump's sweeping tax cut bill could add about $3.4 trillion to US deficits over the next decade, according to projections from the nonpartisan Congressional Budget Office. At the same time, corporate profits remain relatively strong, and although there are some early reasons for caution, high-grade companies are generally generating enough earnings to easily pay their interest now. More US companies are topping earnings estimates this reporting season than the same period last year. Valuations for company debt have been high recently, reflecting investor demand for the debt. High-grade US corporate spreads have averaged below 0.8 percentage point, or 80 basis points, in July through Thursday. That's far below the mean for the decade of about 120 basis points, according to Bloomberg index data. Spreads for euro-denominated high-grade corporates have averaged about 85 basis points in July, compared with about 123 basis points for the decade. To some money managers, high valuations for corporate credit are cause to be wary. Gershon Distenfeld, a fund manager at AllianceBernstein Holding LP, pared back a position that favored credit risk to rates risk earlier this month. Dominique Braeuninger, a multi-asset fund manager at Schroders Investment Management Ltd., agrees that corporate bond spreads are too tight to make them attractive. And even if BlackRock is generally positive on corporate debt, it is underweight long-term high-grade notes because spreads are tight, while being overweight short-term credit. But to many market observers, the world appears to be shifting, and it makes sense to hold more corporate debt now. 'What we've seen on the government fiscal side is not great news,' said Jason Simpson, a senior fixed income SPDR ETF strategist at State Street Investment Management. 'Corporates seem to be chugging along nicely.' Week In Review The US leveraged loan market saw more than $83 billion of launches in the latest week, the second busiest on record, including a $7.57 billion two-part deal from Medline that is set to be the market's biggest pricing since 2015. Repricings were an important driver of volume, representing about two thirds of the tranches, as companies look to cut borrowing costs. Many of the loans that were repriced had already been repriced before The return of billion-dollar M&A deals was supposed to be a boon for Wall Street's leveraged finance desks. It's turning out to be anything but, as private equity cuts them out of many of the most coveted deals. Lenders are demanding higher pricing from two European leveraged-loan borrowers, a rare sign of difficulty these days in the buoyant market for sub-investment grade debt. Chinese developer Country Garden Holdings Co. has agreed to some key restructuring terms a group of bank creditors had demanded, potentially easing the path for an overall debt deal. PepsiCo Inc. sold $4.7 billion of bonds in a pair of offerings that included the longest-dated euro-denominated corporate new issue since February. FedEx Corp. followed Pepsi with a rare two-part euro debt sale as some of its existing notes in the single currency near maturity. Meanwhile, General Electric Co. sold $2 billion of investment-grade bonds, as did Lockheed Martin Corp. Saks Global Enterprises launched a debt exchange after weeks of negotiations with creditors as its $600 million fresh financing takes shape. Separately, Walgreens Boots Alliance Inc. launched a multi-currency debt tender. Banks led by UBS Group and Citigroup have offloaded about $2 billion of debt to support Patient Square Capital's acquisition of Patterson Cos., reviving a deal more than three months after the bonds and loans got stuck on their books due to tariff turmoil in the market. Patterson received about $1 billion of orders for the $500 million junk-bond part of the sale. Dog walking service Wag! Group Co. won court permission to try to slash debt and hand control to senior creditor Retriever LLC as early as next month. On the Move Carlyle Group Inc. recruited Alex Chi, who was most recently co-head of Americas private credit at Goldman Sachs Group Inc.'s asset management arm, to lead its direct lending business. Chi will join Carlyle in early 2026. BMO Capital Markets hired Nii Dodoo as head of private credit financing. Dodoo joins from BTIG, where he was a managing director. Christina Chan, BNP Paribas' regional head of loan sales and head of corporate loan syndicate, Asia Pacific, has left the bank. Toronto-Dominion Bank's US credit trading unit has re-hired Sarah Classen from Goldman Sachs Group Inc. for its voice-trading business. Classen starts in mid-September as a director in TD Securities' global US dollar fixed income trading team, based in New York. Ares Management Corp. hired Sarah Cole as a partner and co-head of Ares Global Capital Solutions to bolster its partnerships with banks, insurance companies and across capital markets broadly. Hedge fund Squarepoint Capital LLP recruited Nathan Fabius, a former strategist at Goldman Sachs Group Inc., to cover Latin American debt. Fabius joined Squarepoint this month and is based in New York. Jefferies Financial Group Inc. plans to double the number of people on its credit secondaries team by the end of 2025, as demand has surged from investors who want to buy and sell existing exposure amid a dearth of fresh deals. Ardagh Group SA creditors are set to pay billionaire owner Paul Coulson as much as $300 million as part of a deal to hand over the keys to the company. Burning Man Is Burning Through Cash Confessions of a Laptop Farmer: How an American Helped North Korea's Wild Remote Worker Scheme It's Not Just Tokyo and Kyoto: Tourists Descend on Rural Japan Elon Musk's Empire Is Creaking Under the Strain of Elon Musk A Rebel Army Is Building a Rare-Earth Empire on China's Border ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
