The US Federal Maritime Commission (FMC) has raised concerns about the planned acquisition of Ports America by the Canada Pension Plan Investment Board (CPP Investments), which has previously been a minority investor in the company.
In a letter to Janet L Yellen , Secretary of the Treasury Department of the Treasury, two FMC commissioners, Carl W. Bentzel and Louis E. Sola , expressed their stance about the potential investment proposed by CPP Investments to acquire 100% ownership of Ports America.
Specifically, the commissioners have requested the Committee on Foreign Investment in the United States (CFIUS) exercise its authority and launch a full and thorough review of the national security implications of Ports America’s acquisition.
“ This proposed acquisition is an all too familiar repetition of a U.S. transportation and supply chain asset being acquired by foreign investors ,” the commissioners said in the letter .
“Our supply chain assets directly impact our domestic economy and our national security. They should not be treated as an ordinary resource to be sold to whomever can pay the highest price. By water, the U.S. global shipping market is served almost entirely by foreign flagged vessels.”
“ CPP Investments is a minority investor in Ports America, but with the proposed acquisition of interest in funds currently managed by Oaktree Capital Management, L.P. it will hold exclusive interest in a strategic United States enterprise. Such a change in ownership of a company managing critical infrastructure should be carefully scrutinized. “
“Such a review is not without precedent. In 2006 the Committee on Foreign Investment in the United States (CFIUS) recognized the strategic importance of port terminal management and stevedoring operations and asserted its authority reviewing the acquisition of the North American operations of P&O Ports by DP World. Congress voted to block the Dubai based Dubai Ports World’s attempted control of P&O Ports North America’s marine terminal and stevedoring concessions at various U.S. ports. It was this action that led to the creation of Ports Americ ,” Bentzel and Sola continued.
“When dealing with strategic infrastructure such as commercial deep-water ports, railroads, airports, telecommunications, or electrical power generation, we as a Nation should be hyper-vigilant when allowing foreign interests to obtain control. This concern is not borne out of nationalism or xenophobia but simple common sense,” the duo stressed.
The letter also includes concerns around Canadian Pacific Railway’s access through the proposed acquisition of Kansas City Southern.