(Yicai) March 5 -- Shares of CK Hutchison Holdings, owned by Chinese billionaire Li Ka-shing, surged over 20 percent after the conglomerate announced the sale of major port assets -- including two strategically significant ports for the United States in Panama -- to a consortium led by American asset manager BlackRock for USD19 billion in cash.

CK Hutchison [HK: 0001] closed 21.9 percent higher at HKD47.10 (USD6.10) after reaching an intraday peak of HKD48.20, its highest level since May 2023. The company is owned by the family of Li Ka-shing, a 96-year-old investor who built his fortune in real estate, ports, and retail and was once China's richest man.

The conglomerate has agreed to transfer all shares of Hutchison Port Holdings (HPHS) and Hutchison Port Group Holdings Limited (HPGHL) to a consortium comprising BlackRock, Global Infrastructure Partners, and Terminal Investment Ltd., the Hong Kong-based seller announced yesterday. GIP is BlackRock's infrastructure investment arm, while TIL is a terminal operator owned by Swiss shipping giant MSC.

The total value of the assets is estimated at USD22.8 billion, with the sale expected to generate over USD19 billion in cash for CK Hutchison after accounting for debt and minority interests.

The move aligns with US interests. President Donald Trump has stated that he would "take back" control of the Panama Canal, so that US Navy and merchant ships could pass through this vital sea artery connecting the Pacific and Atlantic Oceans at a lower cost or even free of charge. In the fiscal year ended last September, over 9,940 ships passed through the Panama Canal, generating a total revenue of USD5 billion, according to data from the Panama Canal Authority.

HPHS and HPGHL hold a combined 80 percent stake in Hutchison Ports, which operates 199 berths and supporting assets across 43 ports in 23 countries. The assets sold exclude Hutchison Ports' holdings in Hong Kong and China's mainland.

Through this deal, the buyers will acquire Hutchison Ports' 90-percent interest in Panama Ports, the operator of the Cristobal and Balboa ports, which are key gateways to the Panama Canal, one of the most crucial maritime trade routes in the world. CK Hutchison took control of the two major ports in Panama in 1997 and renewed the contract in 2021, extending it until 2047.

In the first half of last year, CK Hutchison posted a net profit of HKD10.2 billion (USD1.3 billion), a 9 percent decrease from the previous year, despite a 4 percent increase in revenue to HKD232.6 billion (USD30 billion). Ports outside China contributed less than 10 percent of total revenue, according to the semi-annual report.

Editor: Emmi Laine