As part of the deal, GM will continue to make Hummer SUVs until 2011.

"This transaction marks an exciting step for both Tengzhong and Hummer, as we invest in a business that has significant opportunity in the U.S. and around the globe," Yang Yi, chief executive officer of Tengzhong, said in a statement. "We are excited about some of the initiatives already underway at Hummer that we believe our investment will be able to accelerate, particularly related to the creation of the next generation of more fuel-efficient vehicles to meet not only future regulations but also customer expectations."

GM's Shreveport, La., assembly plant will continue to build the H3 and H3T models and AM's Mishawaka assembly plant will continue to build the H2 until June 2011 with the option of a one-year extension, according to a GM statement.

Hummer is expected to base its global headquarters in metro Detroit.

Hummer's existing leadership team, including CEO James Taylor, will remain, a statement said.

"Backed by a privately owned and well-capitalized company, we are going to be able to focus on providing customers with more efficient models that deliver HUMMER's promise of authentic, purpose-built design and engineering," Taylor said in a statement.

Under the deal, Tengzhong gets ownerships of the Hummer brand and intellectual property license rights required to manufacture Hummer vehicles. It assumes the existing dealer agreements.

Tengzhong has structured the acquisition of through an investment entity. It intends to hold an 80 percent stake in the entity and a private investor named Suolang Duoji will own the remaining stake.

Duoji's other investments include Lumena, which produces thenardite, a mineral used in the manufacturing of glass and paper.

GM and Tengzhong said the deal is subject to customary closing conditions and regulatory approvals in the United States and China.