General Motors Corp’s sale of its Hummer brand to a little-known Chinese truck maker could be blocked by regulators who have not approved the deal.
Sichuan Tengzhong Heavy Industrial Machinery Co (四川騰中重工機械) and GM have given no financial details about the planned purchase.
However, any such deal would require Chinese Commerce Ministry approval at the provincial level at least.
Reports in the Shanghai Securities News and other newspapers yesterday said Sichuan Tengzhong had not yet obtained such approval. They also raised questions over whether the deal will be allowed to go through, with one report likening Tengzhong’s plan to acquire Hummer to a “snake trying to swallow an elephant.”
The surprise announcement of the acquisition by Sichuan Tengzhong, a maker of heavy industrial vehicles such as cement mixers, has raised questions about the privately owned company, which has disclosed scant information about its ownership or finances.
Reports in the financial magazine Caijing and state-run newspapers said a mining tycoon, Suolang Duoji, who is also known by the Chinese name Li Yan (李炎), was behind the deal.
Suolang Duoji indirectly owns a big stake in Sichuan Tengzhong through an investment company called Sichuan Huatong Investment Holding Co (四川華通投資控股), the reports said.
He also is the controlling shareholder and chairman of Lumena Resources Corp (旭光資源), a mining company.
Both Tengzhong and Lumena are based in China’s southwest. However, in the prospectus for Lumena’s IPO, Suolang Duoji lists his residential address as a luxury serviced apartment in Hong Kong.
Meanwhile, the US Army is assuring people that the deal has nothing to do with the military version of the Humvee.
Steve Clawson, spokesman for AM General, said the military and civilian programs are separate.
“GM’s proposed sale of the civilian Hummer brand would have no impact on the military Humvee program,” he said.
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