If China’s Sichuan Tengzhong Heavy Industrial Machinery Co. finalises the $150 million Hummer deal with General Motors Co. today, Tengzhong would be propelled into the global auto industry and GM will get the cash it needs after emerging from bankruptcy on July 10.
According to Bloomberg, the purchase is the first entry into the passenger-vehicle business for Tengzhong, a closely held maker of special-use vehicles, structural parts for highways and bridges, and construction machinery.
Undisclosed sources of Bloomberg say the parties are trying to reach a deal today in a private negotiation. The companies said the deal would protect more than 3,000 U.S. corporate, manufacturing and dealership jobs.
However, there are regulatory hurdles. Bloomberg says the sale requires the acceptance of regulators in the U.S. and China. Tengzhong plans to apply for Chinese approval once a binding agreement with Detroit-based GM is made, says one of Bloomberg’s sources.