China Instructs State Firms to Cease Engagements with Li Ka-shing and Family
Chinese state firms are directed to halt dealings with Li Ka-shing following his family’s sale of their global ports business for over $19 billion. This move is accompanied by a review of their investments in and outside of China, amidst criticisms of the deal’s implications for national interests and increased scrutiny by Chinese regulators.
Chinese authorities have instructed state-owned enterprises to cease all dealings with Li Ka-shing and his family, following the family’s agreement to sell a significant portion of its global ports business, including key assets adjacent to the Panama Canal. This transaction is expected to yield over $19 billion in cash for the Hong Kong-based CK Hutchison Holdings. The order was conveyed to enterprises last week and does not affect existing collaborations.
In addition, Chinese regulators are scrutinizing the investments held by Li Ka-shing’s family in both China and international markets to gain insights into the extent of their business operations. Amid this backdrop, shares of CK Hutchison Holdings demonstrated volatility, settling at a 1.2% increase by noon after previously achieving a 3.6% rise.
Recent articles in the pro-Beijing Hong Kong publication, Ta Kung Pao, have criticized the sale, arguing it undermines China’s national interests and characterizing it as a betrayal. The Hong Kong and Macau Affairs Office has shared these critiques, prompting speculation that Beijing may intervene to obstruct the completion of the sale.
With direction from central leadership, Chinese regulators are actively investigating the proposed deal, which reflects discontent from Beijing regarding CK Hutchison’s divestment, perceived as a response to U.S. pressure. Notably, U.S. President Donald Trump has expressed approval of the transaction, prior to calling for the removal of Chinese influence over the Panama Canal.
In summary, the Chinese government has mandated state firms to stop engagements with Li Ka-shing, following his family’s sale of a major global ports business. This directive, amidst criticism of the sale’s implications for national interests, coupled with regulatory scrutiny, indicates growing tensions between China and the U.S., particularly concerning foreign ownership of strategic assets. The fluctuating share value of CK Hutchison Holdings highlights investor response to these developments.
Original Source: m.economictimes.com
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