http://www.bloomberg.com/apps/news?pid=20601103&sid=a05ak1cbrpaUOct. 9 (Bloomberg) -- General Motors Co. agreed to sell its Hummer sport-utility vehicle brand to China’s Sichuan Tengzhong Heavy Industrial Machinery Co. and another investor, nine days after an accord to unload the Saturn unit collapsed.
Tengzhong intends to buy Hummer through an investment group in which it will hold 80 percent, and Suolang Duoji will hold the rest, the companies said in a statement on GM’s Web site. Duoji’s holdings include Hong Kong-based Lumena Resources Corp.
Disposing of Hummer is a victory for GM in its post- bankruptcy restructuring after the sale of the Saturn unit to Penske Automotive Group Inc. fell through last week. GM is shutting Saturn and Pontiac and is close to a deal with Sweden’s Koenigsegg Group to acquire the Saab brand. Hummer is being sold for $150 million, people familiar with the deal said yesterday.
“It’s important for GM to get some cash, without a doubt,” said Joseph Phillippi, president of AutoTrends Consulting Inc. in Short Hills, New Jersey. “Any appreciable amount they can get means more reserves, means keeping your powder dry until this economy improves.”
For Tengzhong, the deal propels the industrial manufacturer into the global auto market. It aims to expand Hummer’s reach beyond the core U.S. market, Tengzhong Chief Executive Officer Yang Yi said in an interview. “We are really looking to expand our global reach to tackle some of the high-growth markets, particularly the China market, in which we expect to enjoy explosive growth,” Yang said through a translator.
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