国产热热热精品,亚洲视频久久】日韩,三级婷婷在线久久,99人妻精品视频,精品九热人人肉肉在线,AV东京热一区二区,91po在线视频观看,久久激情宗合,青青草黄色手机视频

National

Regional

Taiwan, HK, Macao

Special Coverage

Focus

Society

Profiles

Carlyle abandons Xugong dream

By Wan Zhihong (China Daily)
Updated: 2008-07-24 07:17

China's Xugong Group Construction Machinery Co (Xugong) has abandoned plans to sell a stake to US private equity firm Carlyle, after waiting for as long as three years.

"The investment agreement signed in October 2005 has now expired," said a statement jointly issued by the two companies Wednesday. "Both parties have decided not to proceed with the investment and Xugong will embark independently on its restructuring."

The statement further said: "Given the significant changes in the market environment in the interim, both parties have agreed that it is best for Xugong to immediately proceed with its restructuring into a more integrated, streamlined company to compete effectively worldwide."

In October 2005, Carlyle agreed to buy 85 percent of Xugong for $375 million. It would have been the biggest acquisition by a foreign investor of a controlling stake in a leading State-owned Chinese company.

The takeover bid raised wide concern that China was selling its strategic companies too cheap to foreign investors, and the central government weighed it for a long time.

In the past three years, Carlyle has made several concessions in its bid for Xugong, cutting its stake purchase from 85 percent to 45 percent.

"Carlyle's dropping out of the Xugong deal will make some impact on foreign companies' investment in China's machinery industry," said Sun Xin, an analyst with Southwest Securities in Beijing Wednesday. "They will become more cautious with mergers and acquisitions in the country, especially with big domestic companies. But the deal will not make a big impact on the development of the industry as a whole."

In August 2006, the Ministry of Commerce and other authorities issued new rules on acquisition of Chinese enterprises by foreign investors, saying overseas investors would need the clearance of the central government to buy controlling stakes in key industries.

Xugong is now controlled by Xuzhou Construction Machinery Group, which is owned by the Xuzhou local government. The company is a market leader in China's machinery sector.

Some analysts had said China could lose its technology to foreign competitors if important firms like Xugong are sold to overseas companies. They also said selling off a major firm like Xugong to a foreign company would hurt China's economic security.

In 2006, Chinese heavy machinery manufacturer Sany said it aimed to pay a higher price to buy Xugong. Sany Corp Executive President Xiang Wenbo said the price Carlyle had agreed to pay Xugong was below par. Sany has been planning to buy Xugong for a long time.

Carlyle Wednesday said it "continues to make large investments in China, where it has invested in more than 30 companies and has put in more than $1.3 billion in equity alone in the past two years".

"Both parties believe Xugong's expansion will create opportunities for partnership with Carlyle and its portfolio companies worldwide," said the statement.