Chinese construction equipment maker Xugong Group Construction Machinery Co will reduce the size of the stake it plans to sell to U.S. investment firm Carlyle from 50 to 45 percent, sources with Xugong said Friday.

The Beijing News on Saturday quoted unidentified sources with the securities sector as saying the announcement will be made on Monday,

Wang Yansong, company official of Xugong in charge of the Carlyle sales said on Friday that the new deal is awaiting approval from the Ministry of Commerce.

Insiders believed the ministry will give the green light to the new deal.

Carlyle Group's attempt to buy 85 percent of Xugong was turned down by the ministry.

It agreed to reduce its stake in October last year to form a 50-50 joint venture with the state-owned equipment maker but that deal did not ease fear of foreign control of a key Chinese firm.

The Chinese government recently issued new regulations on enhancing supervision of transactions involving state-owned assets.

The state should maintain majority control over companies in key industries, the State-Assets Supervision and Administration Commission and the Ministry of Finance said in a circular released at the end of January.

Carlyle, based in Washington, is one of the world's largest private equity funds, with some 44 billion U.S. dollars invested around the world in industries ranging from manufacturing and power generation to media and telecoms.