New York-based multinational investment company, Blackrock, and Terminal Investment Ltd – the port arm of global mega-container-carrier MSC, have stunned the shipping world by agreeing to buy most of Hong Kong-based Li Ka-shing’s Hutchison Ports for a cool US$22.8 billion (approx AUD$36.14 billion).
BlackRock and TIL will buy 90% of Hutch’s interest in the Panama Ports Company, which owns and operates that ports of Balboa and Cristobal in Panama. The Panama deal will proceed separately on confirmation by the Government of Panama of the proposed terms of the purchase and sale.
The duo will also acquire 80% of Hutch’s effective and controlling interests in subsidiary and associated companies (the “HPH Transaction”) owning, operating and developing a total of 43 ports comprising 199 berths in 23 countries, together with all HPH’s management resources, operations, terminal operating systems, IT and other systems, and other assets appertaining to control and operations of those ports.
The deal does not include any interest in the HPH Port Trust, which operates ports in Hong Kong, Shenzhen and South China, or any other ports in China.
Speaking on behalf of BlackRock, Chairman and Chief Executive Officer Larry Fink said: “This agreement is a powerful illustration of BlackRock and GIP’s combined platform and our ability to deliver differentiated investments for clients. These world-class ports facilitate global growth. Through our deep connectivity to organizations 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.”
Speaking on behalf of Terminal Investment Limited (TiL), Chairman of TiL and President of the MSC Group Diego Aponte said: “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 (GIP), 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.”
Commenting on the deal, international container shipping analyst, Lars Jensen of Vespucci Maritime, wrote: “With TIL being the terminal-operating arm of MSC, this could be seen as propelling MSC to the top, or close to the top, of the largest container terminal operators. Furthermore, it provides MSC with the possibility to get a much larger level of operational control over many of the key gateway ports and transhipment hubs in their network”.
