Li Ka-shing's clash with China unnerves rich investors in HK

Beijing has amplified criticism of ports deal, is probing it for antitrust violations

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HONG KONG - Billionaire Li Ka-shing's strained relationship with Beijing has sent a clear reminder to Hong Kong's tycoons and global investors eyeing the city as a wealth hub: Never downplay geopolitics.

China's move to amplify criticism of Mr. Li's blockbuster ports deal with US asset management giant BlackRock and probe the transaction for antitrust violations has drawn the attention of rich investors and their advisers.

Some families are waiting to see what happens in the near term before committing to large projects and investments, said Mr. Jean-Sebastien Jacquetin, managing partner of Cavendish Investment Corp, a Hong Kong-based multi-family office serving wealthy families in Asia.

More families are also choosing to diversify, open bank accounts elsewhere and move some of their assets to other jurisdictions like Singapore, he added.

"Hong Kong and Li Ka-shing are unfortunately caught in the middle of a trade war and when the US starts exerting pressure on China, some impact will be felt on Hong Kong," Mr. Jacquetin said, adding that rich international clans may reassess their plans for expanding to Hong Kong.

Beijing's reaction to the deal - which would see Mr. Li's flagship conglomerate sell dozens of ports to a consortium including BlackRock - is stirring some unease just as Hong Kong steps up its efforts to court the global rich and as Hong Kong's competition with other wealth hubs, such as Singapore and Dubai, hots up.