WASHINGTON, DC, March 5, 2025 (ENS) – The Hong Kong-based conglomerate CK Hutchison Holdings said Tuesday that it will sell all shares in its subsidiaries Hutchison Port Holdings and Hutchison Port Group Holdings to a consortium that includes the U.S. company BlackRock Inc. in a deal valued at close to US$23 billion that carries $5 billion in debt.
The $22.8 billion purchase price sent CK Hutchison’s stock up more than 20 percent and placed control of the canal in American hands following pressure from President Donald Trump to take back the crucial waterway across Central America.
The 51-mile (82km) Panama Canal bisects Panama and links the Atlantic and Pacific oceans. Up to 14,000 ships traverse it annually to avoid a long and costly trip around the tip of South America.
Roughly 70 percent of the ocean-going traffic that crosses the Panama Canal leaves or enters U.S. ports. The United States built the canal in the early 1900s as it sought to facilitate the transit of commercial and military vessels from coast to coast.
Washington gave control of the waterway to Panama on December 31, 1999, under a treaty signed in 1977 by then-President Jimmy Carter. Trump has claimed that Carter “foolishly” gave the canal away.
“We didn’t give it to China, we gave it to Panama, and we’re taking it back,” President Trump told a joint session of the U.S. Congress during an address on Tuesday night. “To further enhance our national security, my administration will be reclaiming the Panama Canal, and we’ve already started doing it.”
“Just today, a large American company announced they are buying both ports around the Panama Canal and lots of other things having to do with the Panama Canal and a couple of other canals,” Trump said misleadingly.
In fact, the transaction, which must be approved by Panama’s government, will give the BlackRock consortium control over 43 ports in 23 countries, including the key ports of Balboa and Cristobal, located at either end of the Panama Canal. The other 41 ports are in Australia, Egypt, Mexico, the Netherlands, Pakistan.
Panama President Jose Raul Mulino has accused President Trump of lying when he told members of Congress that the United States is reclaiming the Panama Canal.
In a statement posted Wednesday on X, Mulino said the canal “is not in the process of recovery” by Trump and the U.S. government.
“Once again, President Trump is lying,” Mulino wrote. “I reject, on behalf of Panama and all Panamanians, this new affront to the truth and to our dignity as a nation.”
In 2017, Panama broke diplomatic ties with Taiwan and established formal relations with China. Soon after, Panama became the first Latin American country to join China’s Belt and Road Initiative, a trillion-dollar global infrastructure investment program. The Dominican Republic, El Salvador, Nicaragua, and Honduras also broke ties with Taiwan and turned to Beijing.
U.S. Secretary of State Marco Rubio visited Panama in early February and put President José Raúl Mulino on notice that Panama had to cut Chinese influence over the canal or face potential retaliation from the United States.
President Mulino rejected the notion that China had any control over canal operations, but following Rubio’s remarks Panama quit the Belt and Road Initiative.
In January, U.S. Senator Ted Cruz of Texas, the Republican chair of the Senate Committee on Commerce, Science and Transportation, expressed concern that China could exploit or block passage through the canal and that the ports “give China ready observation posts,” posing “risks for U.S. national security,” Cruz warned.
BlackRock Chairman and Chief Executive Officer Larry Fink said, “This agreement is a powerful illustration of BlackRock and Global Infrastructure Partners’ 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.”
Fink estimated in early 2023 that the firm had lost about $4 billion in withdrawals by Republican state officials tied to an anti-environmental, social, and governance backlash against BlackRock operations. That figure is a sliver of business for BlackRock, the world’s largest asset manager.
The Mediterranean Shipping Company, branded as MSC, is an international line founded by Gianluigi Aponte in Italy in 1970 and owned by the Aponte family with headquarters in Geneva, Switzerland. By both fleet size and cargo capacity it is the world’s largest container shipping company, controlling 20 percent of global container capacity as of July 2024. MSC Cruises sails through the Panama Canal on some of its voyages.
Chairman of Terminal Investment Limited and President of the MSC Group Diego Aponte explained, “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 are very focused on this industry, and we know that the investment in Hutchison Ports will be a very viable investment commercially.”
Speaking on behalf of CK Hutchison, Co-Managing Director Frank Sixt said, “This Transaction is the result of a rapid, discrete but competitive process in which numerous bids and expressions of interest were received. As a result, the Transaction valuation agreed in principle is compelling, and the Transaction is clearly in the best interest of our shareholders.”
In view of the transaction, Republican elected officials are changing their tune about BlackRock.
“BlackRock working with the Trump administration is going to be positive for everybody, I can see that opening up some doors for them,” said Indiana Treasurer Daniel Elliott, a Republican. Last year, Elliott helped push BlackRock out of a contract to manage a nearly $1 billion global bond portfolio over concerns about its environmental, social, and governance framework efforts.
Elliott said he would now be willing to consider BlackRock’s eligibility for future contracts if they were presented to him. Republican treasurers in other states have told him they are also encouraged by
BlackRock’s role in the deal, as well as other recent moves by Fink to diminish ESG efforts, Reuters reports.
“They’re listening to our issues,” Elliott said of BlackRock.
Illinois State Treasurer Michael Frerichs, a Democrat, said, “Unlike too many of my peers on the other side of the aisle, I do not play politics with our investments.” His office has $1.2 billion in educational savings funds with BlackRock.
On May 20, 2019, the Panama Canal Authority announced enhancements to its Green Connection Environmental Recognition Program. The award-winning initiative encourages the shipping industry to mitigate the environmental impact of their operations through an incentive-based system that includes the Green Connection Award, the Environmental Premium Ranking and the Emissions Calculator.
Over the last 105 years, the Panama Canal Authority says the canal has offered shippers “an unparalleled, environmentally sound route.” Given the shorter traveling distance and larger capacity offered, the Panama Canal reduces fuel consumption and emissions, generating less greenhouse gas emissions compared to other routes.
Featured image: IDC Diamond bulk carrier in the Miraflores Locks of the Panama Canal. To the top left is the Port of Balboa on the Pacific Ocean. January 10, 2020 (Photo by David Brossard)
