US private equity firm Carlyle Group will cut its stake in the acquisition of Xugong Group Construction Machinery Co Ltd (Xugong) from 85 to 50 percent.

Xugong Group Construction Machinery Co Ltd shows bucket lift trucks at Conexpo Asia 2006 on May 16 this year. US private equity firm Carlyle Group will cut its stake in the acquisition of Xugong Group Construction Machinery Co Ltd (Xugong) from 85 to 50 percent. [newsphoto]

The remaining 50 per cent stake will be held by State-owned Xuzhou Construction Machinery Group (XCMG) under a deal signed on Monday, said a statement from XCMG's listed unit Xugong Science & Technology Co Ltd yesterday.

Carlyle confirmed the deal, but declined to disclose further details.

"The reduced offer shows the reluctance of Chinese officials to sell major companies to foreign investors," said an analyst who declined to be named.

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