The Shanggong Co. Ltd. (China) will, pending approval by China's Securities Regulatory Commission, issue as many as 100 million "B" shares in a private placement. The total value of that placement would be approximately USD $50 million.

FAG Kugelfischer Georg Schaefer AG (Germany, now an operating entity of INA Holding) will reportedly buy $24 million of the shares. Shanggong has apparently told regulators it will use the proceeds of that placement with FAG to buy into an unnamed FAG unit.

Shanggong is the largest industrial sewing machine producer and exporter in China. It has been publicly traded since 1994. The company's subsidiary, Shanggong Import & Export Co. Ltd., was set up in 1997 for international trade; one of its product lines is bearings.

The unnamed FAG division mentioned by Shanggong most likely involves Duerkopp Adler AG (Germany), FAG's division which manufactures sewing machines and industrial conveyor systems. Today we think of FAG as a bearing company, but in fact it all started as a sewing machine repair shop in the late 1800's.

In late 2000, eBearing reported that FAG had announced plans to sell off Duerkopp Adler after returning it to profitability. Those plans were later dropped.

If China's SRC approves the share placement by Shanggong, it would be the first issuance of "B" shares by a Chinese company in almost two years.