The planned purchase of General Motors Co.'s Hummer brand by a Chinese heavy equipment maker appears stalled by regulators, but that hasn't stopped investors from setting up a fund to invest in the deal.
GM and Sichuan Tengzhong Heavy Industrial Machinery Corp. extended the deadline for Hummer's sale until Feb. 28 pending approval by the Chinese government. With just days to go, there was no sign Wednesday of any movement on the deal at the Ministry of Commerce or two other agencies concerned.
Beijing has shown little enthusiasm for the planned purchase of a loss-making brand best known for gas guzzling off-road vehicles and which GM is trying to unload as part of a new focus on four mainstay brands.
But Tengzhong and its partners appear to have a Plan B: New J&A Tengzhong Fund SPC, a private equity investment fund owned by an offshore entity that is already recruiting private investors to buy into its acquisition plan.
"Why shouldn't China's Tengzhong undertake its responsibility to go out into the world?" says Li Yan, a Sichuan-born mining tycoon, in a declaration on the Web site of New J & A Investment Management, which recently began advertising for investors. Yan is said to be planning to take a 20 percent stake in Hummer.
"Hummer, just like Lady Liberty, represents the spirit of the American people," Li says in the statement illustrated with a Hummer photo. "Our purchase of Hummer conveys the friendship of Chinese civilization to the American people."
New J&A Investment Management, registered in the Cayman Islands and listing an office address in Hong Kong's prestigious Two International Financial Center, is headed by Lucky Lu Shengxi, a fund manager with an MBA from Rensselaer Polytechnic Institute.
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