UPDATE 1-Tengzhong may finalise Hummer deal Friday -source

* Tengzhong may close Hummer deal for about $150 mln Friday

* Deal still needs government approval (Adds details, no comment from GM and Tengzhong)

By Fang Yan and Edmund Klamann

SHANGHAI, Oct 9 (Reuters) - China's Tengzhong may finalise a deal with General Motors Co [GM.UL] on Friday to acquire the U.S. automaker's Hummer business for about $150 million, a source familiar with the deal said.

"GM and Tengzhong may close the deal as early as today," the source with knowledge of the talks between the two sides told Reuters.

GM declined to comment and Tengzhong could not be reached immediately for comment.

Sichuan Tengzhong Heavy Industrial Machinery has been in detailed negotiations with GM since it announced a plan in June to acquire the rights to the premium off-road Hummer brand from its U.S. owner.

According to the preliminary agreement, Tengzhong is expected to retain Hummer's existing senior management and operational team.

It will also keep the dealership network of the U.S. sport utility vehicle unchanged. Hummer is currently sold in more than 30 countries, including China.

The Hummer deal, which still needs the approval of the Chinese government, would mark the first major Chinese acquisition of a distressed U.S. auto asset during the current economic downturn.