CK Hutchison has agreed in principle to sell an 80% stake in its global ports business to a consortium led by Mediterranean Shipping Company’s (MSC) Terminal Investment Limited (Til) and US investment firm, BlackRock.
The $22.8 billion deal covers 43 ports comprising 199 berths in 23 countries but excludes CK Hutchison’s operations in China and Hong Kong.
CK Hutchison, Co-Managing Director, Frank Sixt, said the transaction was the result of “a rapid, discrete but competitive process” in which the company had received numerous bids and expressions of interest.
“As a result, the transaction valuation agreed in principle is compelling, and the transaction is clearly in the best interest of our shareholders.
“After adjusting for minority interests and repayment of certain shareholder loans due from HPH (Hutchison Port Holdings) to CK Hutchison, the transaction would be expected to deliver cash proceeds in excess of US$19 billion to our group. I would like to stress that the transaction is purely commercial in nature and wholly unrelated to recent political news reports concerning the Panama ports,” said Sixt.
He said the deal remained subject to confirmatory due diligence, settlement of definitive documentation and the usual completion procedures, adjustments and conditions.
BlackRock, Chairman and CEO, Larry Fink, said the agreement was a “powerful illustration” of the company’s ability to deliver differentiated investments for clients.
“These world-class ports facilitate global growth. Through our deep connectivity to organisations like Hutchison and MSC/Til and governments around the world, we are increasingly the first call for partners seeking patient, long-term capital. We are thrilled our clients can participate in this investment.”
Bayo Ogunlesi, Chairman and CEO of Global Infrastructure Partners (GIP) – a division of BlackRock – said the company already had a longstanding relationship with MSC and Til and was delighted with the new partnership.
“Given GIP’s substantial expertise in owning and operating ports, together with our partners, we can focus on our joint ambition for these assets to continue to be world-class ports operators which are competitive, efficient, commercial and service-focused,” he said.
MSC Group President, Diego Aponte, speaking on behalf of Til welcomed the partnership.
“Our relationship with Hutchison Ports goes back a long way and is a relationship of mutual respect and friendship. Furthermore, we are very pleased to partner with BlackRock and Global Infrastructure Partners, with whom we share a longstanding relationship.
“We have a very high regard toward the Hutchison Ports management team, and once this transaction closes, we look forward to welcoming them into our larger family. We are very focused on this industry, and we know that the investment in Hutchison Ports will be a very viable investment commercially.”
If approved, the deal will position MSC as a dominant force in terminal operations globally and provide BlackRock with a major stake in critical port infrastructure assets.
The transaction remains subject to regulatory approvals, including in key markets such as Panama, northwest Europe, and Spain.
