Shenyang Machine Tool Group, the country's largest lathe machine maker, has attracted more than 40 investors to buy a 49 per cent stake for at least 1.1 billion yuan, reflecting investors' appetite in China's manufacturing industry.
More than 70 per cent of the interested investors are from overseas, said Liu Chuanwen at the Shanghai United Assets and Equity Exchange, who helped organise the sale. Shenyang's municipal government will keep a 51 per cent stake in the firm after the sale, he added.
The deal came after a string of foreign firms rushed to acquire stakes in the mainland's machine makers, including Volvo Group's agreement to buy 70 per cent of Shandong Lingong Construction Machinery.
Recently, private equity firm H&Q Asia-Pacific also said it has paid US$45 million for a 43.3 per cent stake in Yuchai Engineering Machinery.
However, the influx of foreign investors has raised concerns that they will dominate the local manufacturing industry, prompting United States buyout fund Carlyle Group to cut its planned purchase of Xugong Construction Machinery to 50 per cent from 85 per cent.
'Shenyang Machine's stake sale plan has taken protection of the local industry into consideration as well,' Mr Liu said.
Shenyang Machine, which makes lathes, drilling, milling and heavy-duty machines, plans to sell the stake to three investors with a lock-up period of five years, according to a company statement on the equity exchange.