Shanghai, February 23 (Gasgoo.com) China's machinery manufacturer Sichuan Tengzhong may use an offshore investment vehicle to buy General Motors' Hummer brand if regulators don't approve the deal, Reuters reported today, citing an insider.
Chances of securing regulatory approval for the deal by Sichuan Tengzhong Heavy Industrial Machinery Co in southwest China have dimmed in recent weeks. GM and Tengzhong have extended the deadline for the Hummer transaction from January 31 until the end of February.
"While the transaction approval process is not proceeding as quickly as originally forecasted, we're optimistic about the progress that has occurred to date," Jim Taylor, Hummer's chief executive officer, said earlier this month.
Tengzhong began seeking the regulatory approval in July 2009 by submitting documents to China's National Development and Reform Commission. The commerce ministry initially was very supportive of this deal "as a way for a Chinese company to go global."
GM and Tengzhong have been working to sew everything up on the SUV brand deal since it was first announced last October. Several different regulators of the Chinese government need to approve the deal before it can go through.
In July, Tengzhong said it was looking at an offshore vehicle specifically set up to facilitate its purchase of Hummer and would be the majority stake holder in the offshore investment vehicle.
