A company based in the United Arab Emirates, Dubai Ports World, says it is transferring management operations at six U.S. ports to a U.S. entity. The surprise move comes in the wake of a congressional uproar over the firm's acquisition of the ports.
Senator John Warner, a Virginia Republican and chairman of the Senate Armed Services Committee, read a statement from Dubai Ports World's chief operating officer, Edward Bilkey, about the company's decision.
"DP World has decided to transfer fully U.S. operations of P&O Ports North America to a United States entity," he said. "This decision is based on an understanding that DP World will have time to affect the transfer in an orderly fashion and that DP World will not suffer economic loss."
The company's decision came after the Republican-led House of Representatives and Senate signaled they were prepared to vote to block the deal on grounds of national security, despite threats from President Bush to veto any such measure.
But it is not clear how Dubai Ports World would manage the divestiture, and lawmakers say they are waiting to learn the details.
"The devil is in the details," said Senator Charles Schumer, a New York Democrat. "We have to make sure that all U.S. operations are totally removed from the United Arab Emirates and Dubai Ports World control."
But many Republicans say the announcement ends the controversy that distanced them from the White House this congressional election year.
"I think all the talk of the split between the Congress and the White House is over and done with," said Congressman Peter King, a New York Republican.
The strong congressional opposition to the ports deal had reflected similar opposition among the American public. The Senate's top Democrat, Senator Harry Reid of Nevada - a landlocked state with no ports - said phones in his office at the Capitol and in his home state had been flooded with calls from concerned constituents.