Tengzhong to Establish Offshore SPE for HUMMER Purchase

Tengzhong announced Wednesday that it will establish an off-shore special purpose entity (SPE) to facilitate the purchase of HUMMER.

Without getting TOO technical or confusing, an SPE is typically set up by a company to separate the “sponsor” company (in this case Tengzhong) from another venture, thus reducing financial risk to the main company. It will also allow Tengzhong to setup an organizational structure for minority stake-holders, such as a well-known Chinese chemical company CEO.

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  1. OK so in layman terms?

    Tengzhong is looking to branch out Hummer as a separate entity?

    Sharing all day to day fiscal responsibility with multiple investors/companies?

    Makes sense, Hummer fails they don’t take 100% hit. At the same time they can still use the Hummer name for their commercial fleet!!

    If I have it right, what are the odds brining on these investors/companies?

  2. As I remember this country was a lot better off when we were separated from China.