Tengzhong's Hummer bid is trade, not investment

Shanghai, September 10 (Gasgoo.com) Chinese machinery maker Tengzhong's bid to acquire the Hummer brand from General Motors should be viewed as a trade in technology and not an overseas investment, a top Chinese planning official said today, Reuters reported.

Zhang Xiaoqiang, vice chairman of the National Development and Reform Commission, told Reuters that the Ministry of Commerce, not the NDRC, would have ultimate authority over the deal. He was speaking on the sidelines of the World Economic Forum in the northeast Chinese city of Dalian.

"According to the full documents they submitted, the Tengzhong deal does not belong to overseas investment, but rather should be seen as a trade in technology and services, because they want to buy the brand, the technology and the patents," Zhang said.

Sichuan Tengzhong Heavy Industrial Machinery unveiled plans in early June to take over the Hummer brand. The company's lack of experience in the car industry has stirred doubts, while the Chinese government seems hesitant about taking over a gas-guzzling SUV brand.

Opposition has quieted down in recent weeks after China's commerce ministry sounded a more positive note on the deal, saying Tengzhong's move was normal for a Chinese company seeking global opportunities.

The commerce ministry has not rejected Tengzhong's planned purchase of Hummer but has asked for more information on the deal, a source familiar with the matter said earlier this week.

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