• Wed
  • Sep 3, 2014
  • Updated: 1:14pm

Li Ka-Shing

Often referred to as “Superman” in Hong Kong because of his business prowess, Li Ka-shing is the richest businessman in Asia, and chairs conglomerate Hutchison Whampoa and Cheung Kong Holdings, a property group. Li turned Cheung Kong Industries into a top property group, and Cheung Kong expanded to acquire Hutchison Whampoa in 1979 and Hongkong Electric in 1985. Li is a noted philanthropist and heads a charitable foundation that is a shareholder in Facebook.

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Li Ka-shing sells bulk share of port terminal to mainland shipping giants

Tycoon unloads 60 per cent of Terminal 8 West to mainland shipping giants for HK$2.5 billion, raising doubt over commitment to Hong Kong

PUBLISHED : Thursday, 13 March, 2014, 8:15pm
UPDATED : Friday, 04 April, 2014, 10:27am

Tycoon Li Ka-shing has sold the bulk of his stake in a port terminal, disposing of another asset in Hong Kong and raising fresh questions about his oft-repeated claim that he has confidence in the city and will not withdraw.

The port arm of Li, Hutchison Port Holdings Trust (HPHT), decided to sell a 60 per cent stake in Hong Kong Terminal 8 West for HK$2.47 billion to two mainland shipping conglomerates. The pair are Cosco Pacific, which acquired the 40 per cent stake, and China Shipping Terminal Development, which bought a 20 per cent share.

Gerry Yim, HPHT chief executive, said the deal would improve port operations in terms of flexibility, efficiencies, synergies and profitability.

Analysts digested the latest significant move by Li.

"Li has long lost confidence in the Hong Kong port business when he decided to spin off the operations of HPHT in the Singapore Exchange in 2011," an industry analyst said. Others demurred, saying the move was consistent with the strategy where he spun off his holdings in Hong Kong Electric and considered selling ParknShop last year.

"The port business is still a cash cow but the ports in Hong Kong have turned mature and could register low growth," said Benjamin Lo, an analyst at Nomura International.

Li has long lost confidence in the Hong Kong port business when he decided to spin off the operations of HPHT in the Singapore Exchange in 2011
Industry analyst

"The company is in the process of monetising low-growth assets which have good valuations when the interest rate environment is favourable and to deleverage the balance sheet ahead of an upcycle in the interest rate."

Hong Kong port has been overtaken by Shenzhen as the world's third busiest container terminal. The city's dock strike last year prompted shipping lines to divert cargoes to Shenzhen and most have not returned.

Li, Asia's richest man, gave a downbeat assessment of Hong Kong last month, warning that the Occupy Central campaign, the harassment of mainland tourists and declining competitiveness with neighbouring markets would erode the city's prospects. But in November he had dismissed suggestions that he was pulling out of the city as a "big joke".

The sale of the terminal came a year after HPHT acquired the entire stake of Asia Container Terminals, the operator of T8 West, from DP World terminals.

Talks between HPHT and Cosco Pacific began in June after operations in Li's Hong Kong International Terminals were paralysed by the 40-day strike that ended on May 6. The dispute became so bitter that striking dock workers placed a demon-like effigy of Li in front of the Cheung Kong building, the headquarters of his flagship company.

After selling the 60 per cent stake in T8 West, HPHT will continue running the T4, T6,T7 and T9 terminals in Hong Kong.

HPHT saw its earnings sink 25 per cent year-on-year in 2013 to HK$1.67 billion as the volume of business at its Hong Kong port operations declined 12.4 per cent.

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18

This article is now closed to comments

johnyuan
One out of five terminals he has just unloaded.
.
Businesswise, the business has been relocated to his Shenzhen’s terminals after the workers’ strike in Hong Kong.
.
Politically he scores high using an impeccable timing at the heel of his last medium ‘interview’ to make a point. He is telling CY Leung and the public that you all read my lips and see my feet – walking out of Hong Kong.
.
His political maneuvering is taking a new form from his pulling strings way in previous administrations since the handover.
Let us hope the new owners can pay the dockers better and elevate the environmental quality which in response to the call by the current central government. There must be a reason why the buyers are from mainland.
lillian_mak_hk@yahoo.com.hk
buy low sell high only. what’s strange. it sends a message that asset prices a going down in his forecast period. follow his strategy or not?
r6b
Too many wrong headed emotions.
He has only sold a part of 1, of the 5 HK terminals he owns,
to a shipping company that wants its own exclusive space.
This sounds like just good business - nothing more.
Over the years, he has done the same with mobile telcos in Europe.
He has the right/obligation to deploy his capital, to the best advantage of shareholders.
daily
Quite the hypocrite................
sjfore
Li deserves a lot of the flak he gets, but not on this. Getting out of the HK container port business is just plain smart.
John Adams
Bye Bye LKS
We won't miss you, nor your money.
Hope you take your two sons with you
pragmatist
It's funny to read the comments. People are unhappy he leaves but do not want to listen to the bitter truth he is uttering about HK's declining competitiveness (including no attention to education and innovation).
aplucky1
this guy would sell his mother to make a penny
chuchu59
This is only to be expected given the guy's recent comments. He is not getting the things his way so with no favours from both the central and HK governments he thinks he had better cash out before things take a worse turn for him. Its time for his exit to pave way for other younger and more enthusiastic entrepreneurs.
Chris Yu
As expected. He has planned to shift his market to european countries. HK is no longer for him to make a huge profit.

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