Shares of CK Hutchison Holdings, the Hong Kong-based conglomerate that recently sold two ports in the Panama Canal to BlackRock, dropped by over 6% on Friday, even as the city’s benchmark Hang Seng Index rose by over 2%.
The slip comes after the Hong Kong and Macao Affairs Office, the ministry responsible for the Chinese city, reposted scathing commentary from Ta Kung Pao, a local newspaper backed by the Chinese state.
On March 4, CK Hutchison announced that it had agreed to sell its global ports business, except for its ports in mainland China and Hong Kong, to a BlackRock-led consortium of investors in a deal valued at $23 billion. The deal came after the Trump administration threatened to retake control over the canal, with the president citing CK Hutchison’s operation of two Panama ports as evidence of Chinese control.
Ta Kung Pao called CK Hutchison’s decision to sell its global port operations to a BlackRock-led consortium as an “act of submission and betrayal,” alleging the company was sacrificing national interest for profits. The piece argues that Washington is “making every effort” to suppress China’s development.
CK Hutchison did not immediately respond to Fortune’s request for comment. The conglomerate has previously stated that the deal was “purely commercial in nature.”
Friday’s drop dents a surge in the conglomerate’s share price, which jumped by as much as 33% in the days following the BlackRock deal.
The deal is arguably win for CK Hutchison, which got BlackRock to pay well in excess of how much the ports business was worth. The company, formerly led by Hong Kong billionaire Li Ka-shing, said it was getting over $19 billion in cash from the deal. That’s more than the conglomerate’s entire market value, and much more than a Morningstar’s estimated valuation of $10.5 billion for the ports business.
The ports business is a small (though profitable) part of the conglomerate’s operations. CK Hutchison also has interests in energy, telecoms and retail.
Still, Trump’s celebration of the deal as a win for the U.S. in his address to Congress last week might have encouraged a nationalist reaction. Ta Kung Pao called the Panama Canal deal an “act of hegemonic coercion,” and speculated that an “Americanized” Panama Canal would help Washington at the expense of Chinese business.
CK Hutchison is keeping its ports based in mainland China and Hong Kong, and so the deal is unlikely to require approval from Beijing. The conglomerate maintains that its business operations are independent from China.
Still, a government office reposting critical commentary is a signal of official displeasure—and shows the narrow space that global companies have to navigate amid worsening U.S-China tensions.
For example, Beijing is scrutinizing Walmart following reports that the U.S. big box retailer tried pressuring Chinese suppliers for discounts following Trump’s tariffs on China.
Chinese officials told Walmart that asking for discounts could violate contracts and disrupt market order, according to the Wall Street Journal.
If the retailer persisted in asking for discounts, then “what awaits Walmart is not just talk,” a social media account from CCTV warned.
