The deal, agreed between CNI and the local government in Jiangsu, will see CNI invest CNY15bn in new research and production facilities for XCMG. Speaking to People’s Daily, analyst Xu Xingyue of Greatwall Securities, said the move from being a locally-controlled state owned enterprise to ownership by China’s central government will ensure the business has sufficient funds for its future development.

Bids for 85%, and subsequently for 45%, of the business, put forward by investor Carlyle Group had both been rejected by China’s ministry of commerce.