Panama To Review All Legal & Financial Documents In BlackRock’s Port Deal

Panama will review the recent acquisition of two key ports by a BlackRock-based group, demanding all legal and financial documents linked to the transaction.

The Panama Maritime Authority, responsible for overseeing ports and shipping, will assess the deal to ensure the country’s interests are protected.

The takeover involves Hong Kong-based CK Hutchison selling its port business to an investor group led by US firm BlackRock. This includes 90% stake in Panama Ports Company, which operates the Balboa and Cristobal terminals under a 25-year concession.

The transaction is part of a deal where CK Hutchison is selling an 80% share in its global port operations for an equity value of $14.21 billion, but the total amount it will receive exceeds $19 billion due to loan repayments.

Juan Carlos Orillac, Panama’s minister to the presidency, confirmed that the government has requested a detailed review of the deal at the cabinet’s request.

Authorities want to analyse the agreement since the Balboa and Cristobal terminals are located near the Panama Canal, a crucial global trade route.

Panama’s Comptroller General has yet to complete an audit of CK Hutchison’s port concession renewal, which was granted in 2021. The deal has also attracted attention from US lawmakers who argue that CK Hutchison’s previous control over Panama’s ports posed a security risks.

Some American officials this could impact operations at the canal.

US President Donald Trump claimed that his administration had already started reclaiming the Panama Canal. Speaking before the Congress, Trump suggested that US control over the canal was necessary due to the BlackRock-backed acquisition.

However, Panamanian President Jose Raul Mulino dismissed Trump’s statement as false. He stated that the canal is under Panama’s ownership and will continue to operate independently.

The canal, which was returned to Panama by the US in 1999 under a neutrality treaty is managed by an autonomous authority and does not depend on the country’s port infrastructure.

Daniel Isaza, president of Consejo Empresarial Logistico, said that CK Hutchison’s administration of Balboa port previously opposed new port projects in the Pacific, including the Corozal port and had filed multiple lawsuits to stop its construction.

He suggested that new management could bring fresh investments, expanding Panama’s port infrastructure.

Reference: Panama Canal

Source: Maritime Shipping News