A Chinese company's offer to pay $150 million to buy General Motors' Hummer brand will effectively be blocked by Beijing.

The Chinese Government is on the look out for fuel-efficient, environmentally friendly vehicles. The Government does not have any qualms to acquire companies overseas but they avoid what could be an embarrassing bargain.

On Wednesday, China's Assistant Commerce Minister, Wang Chao said at a news conference that the Commerce ministry has not received an application for the deal from Tengzhong.

On the other hand, some news reports said that GM and Tengzhong are still talking about how to get the deal done.

There’s a buzz that Tengzhong could face restrictions from the Government on the purchase of Hummer. That would spill water on its plans to build and sell Hummers in China.

This conveys the message to other companies who are eyeing Chinese investment. China might have generous foreign exchange to back its firms overseas expansion efforts. But if that do not fit with Beijing's own policy ambitions, they are not likely to bear fruits.