Hong Kong-based CK Hutchison Holdings is at the center of a geopolitical storm following its decision to sell the operating rights of a Panama Canal port to a U.S. company, drawing the ire of Chinese authorities. Amidst the controversy, CK Hutchison announced on March 31 that it has been considering the spin-off of its global telecommunications business but has yet to make any concrete decisions.
In a statement filed with the Hong Kong Stock Exchange, the company revealed that it regularly evaluates proposals to enhance shareholder value, which includes potential transactions like spin-offs and separate listings related to its telecommunications business. However, it cautioned that no decision has been made, and there is no guarantee that any transaction will proceed.
This development follows reports that CK Hutchison was contemplating listing its telecommunications unit on the London Stock Exchange. According to Reuters, the company has been consulting with financial advisors regarding a potential spin-off of its telecommunications operations across Europe, Hong Kong, and Southeast Asia.
The company's telecommunications footprint spans more than ten countries, operating under the "Three" brand in the UK and several European countries, as well as providing services in Hong Kong, Macau, Indonesia, Sri Lanka, and Vietnam.
Meanwhile, Chinese authorities have ramped up pressure on CK Hutchison, initiating an anti-trust investigation into the port sale to U.S. firm BlackRock. This move is accompanied by a barrage of criticism from pro-Beijing media, urging the company not to cooperate with what they describe as "U.S. hegemony."
The State Administration for Market Regulation (SAMR) announced the investigation on March 28, leading CK Hutchison to delay the finalization of the port sale contract. The Hong Kong and Macao Affairs Office of China's State Council also weighed in, publishing articles warning against collaborating with the U.S.
In response, Chinese Foreign Ministry spokesperson Guo Jiakun reiterated China's opposition to economic coercion and practices that infringe on other nations' rights, underscoring the broader geopolitical tensions surrounding the port sale.
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