Hong Kong's CK Hutchison has started international arbitration proceedings against Panama after the country's top court annulled its licences to operate two Panama Canal ports. The decision, which could take years to resolve, casts further doubt on the future ownership of the two ports and the company's planned $23 billion deal to sell its port businesses.
The ruling also opens a new front in contention between the United States and China, as they grapple for control of the world's most important trade routes. S.
lawmakers as a 'win for America', while China has warned Panama there would be 'heavy prices' to pay for the ruling which it called 'absurd' and 'shameful and pathetic'. 4%.
The two Panama Canal ports are at the heart of a $23 billion buyout bid led by BlackRock and Mediterranean Shipping Company of CK Hutchison's 43 ports in 23 countries. BlackRock and MSC did not immediately respond to a request for comment from Reuters.
Some analysts think a transaction can be finalised without the two Panama Canal ports included in the portfolio of assets, but the company may use the arbitration process to seek damages and compensation for having the contracts annulled. The deal opened a new front in contention between the United States and China, as they grapple for control of the world's most important trade routes.
CK Hutchison's Balboa and Cristobal ports are considered strategic assets in the Panama Canal, the main seaborne trading route into the United States.
The arbitration process could take years to resolve, given the political sensitivities involved and the complexity of the deal. The company may need to navigate a delicate balance between its interests and those of its shareholders, as well as the governments of Hong Kong and China.
