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

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.