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Acquisition of Hummer: M&Challenges Faced by Chinese Companies Overseas Case Solution & Answer

In June 2009, Sichuan Tengzhong Heavy Machinery Company Limited (“Tengzhong”) industry, a little known manufacturer of construction machinery and special vehicles in southwest China, has taken the global automotive industry by surprise when he announced his intention to acquire the Hummer division to lose money bonuses utilities General Motors Corp. Hummer SUV and trucks had relatively low fuel consumption of September 16 mpg SUVs. Since 2006, sales of Hummer had fallen sharply due to escalating oil prices, its negative image as a “gas guzzler” and changing customer preferences for small sedans. Tengzhong has no previous experience in the field of light vehicles or in the management of a large automotive brand. Because it was the first attempt to Tengzhong foreign direct investment, which was essential for understanding the management of the main obstacles in management. Hummer its new subsidiary in the U.S. They must also develop a solid business plan to obtain approval from the Chinese government for the acquisition, and that the investment is a success. (Note: The acquisition was canceled in February 2010 due to Tengzhong has not been able to get the approval of the details of the Chinese government are included in Annex 1 of the teaching notes for reference.).
by
Dean Xu,
Penelope Chan
Source: University of Hong Kong
37 pages.
Release: June 24, 2010. Prod #: HKU893-PDF-ENG
Acquisition of Hummer: M & A Challenges of Chinese enterprises abroad Solution Case

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