China's Xuzhou to buy assets from parent - source

SHANGHAI, June 19 (Reuters) - Xuzhou Construction Machinery Science & Technology Co 000425.SZ, a machinery maker, plans to issue new shares to its parent company in exchange for industrial assets, a source familiar with the deal said on Thursday.

The listed company will obtain stakes in other subsidiaries of the parent, Xugong Group Construction Machinery Co, and also buy production assets of the subsidiaries, the source said.

The companies have started due diligence for the deal, the source added, declining to provide details.

Shares in Xuzhou have been suspended since last Friday pending an announcement on "a major transaction". Xugong is China's biggest machinery maker. (Reporting by Fang Yan; Editing by Andrew Torchia)