Goldman Sachs gets nod for China Shuanghui purchase

BEIJING/SHANGHAI, Dec 12 (Reuters) Beijing has approved a 0 million bid by Goldman Sachs for China's largest meat-processing firm, boding well for other foreign acquisitions including Carlyle's stake purchase in the country's top machinery maker.

A consortium led by Goldman Sachs, called Rotary Vortex, in May won a bid to buy Shuanghui Group. The deal had been awaiting approval from the Ministry of Commerce since the State Assets Supervision and Administration Commission (SASAC), the agency that oversees state firms, gave its initial nod in August.

A local SASAC in Henan province where Shuanghui is based, got permission from the ministry to sell its 100 percent stake in Shuanghui to Rotary Vortex for 2.01 billion yuan (6.6 million), Shuanghui's listed unit, Henan Shuanghui Investment&Development Co. said in a statement.

Rotary Vortex would also buy a 25 percent stake in Henan Shuanghui Investment &Development Co. for 582 million yuan, the statement said. That stake would be purchased from Luohe Haiyu Investment Co.

The deal has yet to be approved by Chinese securities authorities.

Chinese authorities have been dragging their feet in approving some major foreign investments in Chinese firms, fearing China might be selling its assets too cheaply.

''The Shuanghui case raises hope for other M&A cases, especially those that pose little threat to China's economic security such as SEB's purchase of Supor.'' said Xu Yinghui, a senior analyst with Guotai Junan Securities.'' He was referring to French cookware and household appliance maker SEB's proposal to control Supor Cookware Co. Ltd.

, China's biggest firm in the industry -- in a 5 million deal unveiled in August.

Other high-profile cases yet to be cleared by regulators include private equity company Carlyle's [CYL.UL] acquisition of a stake in Xugong Group Construction Machinery Co. in eastern China.

The U.S. investment firm has been trying to obtain permission to buy into Xugong for more than a year. In an effort to improve its chances, it agreed in October to cut the size of its proposed stake in Xugong to 50 percent from 85 percent.

The purchase, expected to cost around 0 million, is still awaiting Beijing's greenlight. Wang Min, the chairman of Xugong's parent, told Reuters last month that he was confident that the case would be approved before the end of the year.

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