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Buyer Community> Trade Intelligence> Automobiles> Tengzhong, Hummer delay merger
Source: Global Times Global Times

Tengzhong, Hummer delay merger

Published: 29 Jun 2009 17:02:01 PST

By Shi Jierui

Sichuan Tengzhong Heavy Industrial Machinery Co. did not sign the contract yesterday to buy General Motors Corp.'s Hummer unit, and instead the deal was delayed until July 10, according to sina.com.cn.

GM agreed to sell Hummer to Tengzhong earlier this month, for about $500 million.

A source familiar with this deal told sina.com.cn, "Tengzhong and GM have to discuss on the specific price. But this will be solved, and they have decided to sign the contract on July 10."

However, local media reported Friday that Chinese regulators are likely to reject the deal due to environmental concerns related to Hummer's gas-hungry vehicles and to Tengzhong's lack of experience as an automaker.

As a result, Tengzhong began formal talks with Chinese regulators today, aiming to win approval for its acquisition, people close to the deal said.

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