Discussion in 'China' started by A.V., Jun 3, 2009.
Phew! Copied this also
I guess all the hoopla was premature.
China Hummer Takeover Stalls in Driveway
General Motors Corp.'s planned sale of its Hummer brand to a little-known Chinese truck maker could be blocked by regulators who have not approved the deal and are questioning its wisdom.
Sichuan Tengzhong Heavy Industrial Machinery Co. and GM have given no financial details about the planned purchase of the American maker of gas-guzzling, military-style SUVs.
However, any such deal would require Chinese Commerce Ministry approval at the provincial level at least.
Reports in the Shanghai Securities News and other state-run newspapers Friday said Sichuan Tengzhong had not yet obtained such an 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, was behind the deal.
Suolang Duoji indirectly owns a big stake in Sichuan Tengzhong through an investment company called Sichuan Huatong Investment Holding Co., the reports said.
He also is the controlling shareholder and chairman of Lumena Resources Corp., a mining company that is preparing to list shares on the Hong Kong Stock Exchange.
Both Tengzhong and Lumena are based in China's mountainous southwest. However, in the prospectus for Lumena's IPO, Suolang Duoji lists his residential address as a luxury serviced apartment in Hong Kong.
Staff at Tengzhong's public relations firm refused comment. Staff at Tengzhong's headquarters in Chengdu, Sichuan, referred inquiries to the PR agency.
A woman who said she was a human resources manager at Sichuan Huatong refused to transfer calls to any other numbers, saying company policy was to keep such numbers secret.
Lumena is the world's second largest producer of thenardite, a form of sodium sulfate that is used to make detergents and in textile and glass production. The company prospectus reports 1.9 billion yuan ($278.6 million) in assets and net profit of 442.1 million yuan ($65 million) in 2008.
The exact relationship between Lumena and Tengzhong is unclear, as is Tengzhong's own financial status.
Tengzhong is likely benefitting from heavy stimulus spending on construction projects and from rebuilding from last year's earthquake in Sichuan, given its specialization in construction equipment and heavy trucks.
The company earlier said it broke ground on a 3.5 billion yuan ($500 million) factory to make oil field equipment.
Tengzhong's CEO, Yang Yi, has said the company will keep Hummer's headquarters and operations in the U.S., while investing more in research and development of more fuel-efficient vehicles: the Hummer now gets 15 mpg.
Moneynews - China Hummer Takeover Stalls in Driveway
China 'to block' Hummer takeover
Friday, 26 June 2009 15:41 UK
A Chinese firm's bid to buy the gas-guzzling Hummer car brand will be blocked on environmental grounds, according to Chinese state radio.
Sichuan Tengzhong Heavy Industrial Machinery emerged as the surprise buyer for the brand earlier this year.
But China National Radio said Hummer is at odds with the country's planning agency's attempts to decrease pollution from Chinese manufacturers.
But Sichuan Tengzhong disputed the accuracy of the radio report.
"The fact that it is from an article from a state media organisation does not mean it is government policy," the company said in a statement.
"Some people may have views and speculation, but the Chinese government has a process that we respect."
The acquisition from General Motors needs Chinese regulatory approval.
The value of the bid was not disclosed at the time, but analysts say that GM would have made about $100m (£61m) from the sale.
National Development and Reform Commission (NDRC) will also block Sichuan Tengzhong from buying Hummer because the Chinese construction equipment maker lacks expertise in car production, the state radio added.
Sichuan Tengzhong said: "The view expressed on China National Radio's website did not quote or source anyone at NDRC."
"We do not yet have a definitive agreement, but are developing our proposals with GM and Hummer and we will continue to engage with the appropriate authorities in an appropriate manner."
Hummers were originally built as military off-road vehicles by a company called AM General.
GM bought the Hummer brand in 1999.
The brand took off as US consumers flocked to large cars and sport utility vehicles and were favoured by celebrities including Arnold Schwarzenegger
But sales have suffered as the military image has become less popular and petrol prices surged.
Hummers weigh up to five tons and have fuel consumption of around 15 miles per gallon.
The sale of Hummer, known as "Han Ma" or Bold Horse in China, has been part of GM's plan to reinvent itself by concentrating on fewer brands.
BBC NEWS | Business | China 'to block' Hummer takeover
Anyone knows of the IA aquisition of the Mahindra Axe? It's a good one that will replace all it's good old Jeeps. It's on the lines of the Hummer that the US army has.
Does indian auto industry has the ablity to copy?
No they don't because they are not copy cats
I don't think USA will give up their auto market so easily, the government will help the industry to return.
I think the Chinese government's primary reason for stopping this deal is because of the poor prognosis of the product. The thought of the communist party taking any stance taken on "environmental" grounds is laughable.
Not for this product they won't.
well, US motor industry is getting rid of gas guzzlers and focusing on vehicles that runs on green alternate fuels. u can see more GREEN vehicles are comming from US's sillicon vallies and elsewhere and there are quiet a few of them made into headlines like Tesla, Karma and volt. the only prob right now is they are little expensive and hope the price will be reduced soon. California is already become the test ground for Honda's hydrogen powered car "Clarity." The era of gas guzzling hummer is over my friend and Hummer can only survive if Chinese company transform it into a pure enviornmental friendly vechicle at the same time keeping its "tough guy" legacy.
Atleast US is in the right direction and learning the lesson in the hardway, Chinese motor industry will only thrive/survive in this 21st century if it produce enviornmental friendly vehicles. same goes with India.
It pleases me that China could replicate my Daewoo Matiz as Cherry and call it their original!
India believe is market ethics and so will NOT copy!
Last time when i checked it was on winter trials along with some other vehicles. Countries like Israel and Malasya are interested in Axe also.
Ray, you are misinformed. India does not believe in market ethics, maybe some other kind, but definetely not market.
Tell me how many of the cars manufactured in India were copied? or are you talking about things in general?. Market ethics is strong compared to many developing countries and definitely better than China. Heck! the chinese even copied Indian motor cycle Pulsar and named it as Gulsar, totally shameless.
I am not talking about cars. I am talking about other goods.
Market ethics are relatively strong compared to developing countries, definitely not in the same league as advanced countries, but then we are improving. But then do you have anything in mind that you want to talk about?.
Separate names with a comma.