BlackRock buys Panama Canal Port Company for US$19 billion

 

 


Researcher Carlos Puelma, writing at msn.com, reports that the conglomerate CK Hutchison Holdings Ltd. has handed over control of a unit operating ports near the Panama Canal, following pressure from U.S. President Donald Trump to reduce Chinese influence in the region.

The deal involves the sale of 90 per cent of Panama Ports Co., the company responsible for managing the Balboa and Cristobal entries, to a consortium led by BlackRock Inc. and its Global Infrastructure Partners division.

This transaction marks a milestone in the battle for strategic control of the interoceanic route, a key point in commercial geopolitics.

The operation, valued at approximately $19 billion, takes place in a context where the Panamanian government had considered canceling Hutchison's concession to operate the ports. Additionally, an ongoing audit of the contract had created uncertainty about the company's future in Panama.

The sale represents a strategic move for both the Chinese group and Panamanian authorities, who have sought to ease tensions with Washington.

President Trump has been a strong critic of Chinese influence in the Panama Canal, arguing, without evidence, that Beijing controls the waterway and that the United States pays an excessive cost for the passage of its government ships.

Hutchison's presence in Panama dates back to 1997, when it obtained the concession for the Balboa and Cristobal ports, extended in 2021 until 2047. However, growing political pressure and regulatory uncertainties led the conglomerate to reconsider its stay in the country.

For Panama, the change of operator represents a shift in the management of its port infrastructure, at a time when the Canal faces challenges due to the climate crisis and transit restrictions due to water scarcity.

BlackRock's acquisition of the ports will require approval from the Panamanian government, but the transaction is already considered one of the largest in the sector's history.

The American firm has strengthened its bet on global infrastructure following the acquisition of investment specialist GIP, consolidating its presence in strategic markets.

Larry Fink, CEO of BlackRock, highlighted that this agreement reflects the company's ability to attract long-term investments in high-impact projects.

The impact of the transaction was not limited to geopolitics. On Wall Street, BlackRock shares fell 3.1 per cent, reflecting market uncertainty amid the escalation in the U.S.-China trade war

In contrast, CK Hutchison's American depositary receipts rose 6.2 per cent, showing investors' relief after the company's exit from an increasingly risky operation.

Article by MSN.com/money

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