China's Xugong Group announced in Xuzhou, Jiangsu Province Tuesday that it has signed an agreement with Carlyle Group to sell 85 percent of shares of its subcompany to the US-based firm at 375 million US dollars.

Xugong Group will retain a 15 percent of its holding of the Xugong Group Construction Machinery Co. Ltd. (XCMC), a state-owned enterprise located in east China's Jiangsu Province.

The investment from the Carlyle Group will help XCMC grow stronger and prepared for international expansion with technological innovation and new investment projects, said Wang Min, chairman of XCMC.

He noted that this transaction will help the company build an energetic and competitive system in the company, and reach out to more international marketing channels.

The transaction has been approved by Xuzhou municipal government, and will be submitted to relevant authorities of the country for approval if the provincial authorities approve.

(Xinhua News Agency October 26, 2005)