BEIJING, Aug. 22 -- U.S.-based Caterpillar Inc. said its China-based subsidiaries had teamed up with a Shanghai industrial park developer to expand the heavy machinery maker¡¯s presence in that country, sending its shares up 3 percent.

    The company said the subsidiaries have signed three nonbinding memoranda of understanding with the developer, which is affiliated with the city government.

    The subsidiaries will partner with the Lingang Industrial Area to establish a regulatory system for trade, establish the area as the main remanufacturing center for Caterpillar machines, and set up a service center.

    ¡°These initiatives are tangible examples of our plans for future growth across all lines of Caterpillar¡¯s business in China,¡± chief executive Jim Owens said.

    Caterpillar, which first opened an office in China in 1978, has its marketing headquarters in Beijing. Owens told analysts on the July 21 earnings conference call that sales in China are approaching US$1 billion a year.

    Caterpillar operates 10 facilities and employs about 2,000 workers in China.

    In May, Owens said the company wanted to own more Chinese businesses outright and was talking with government officials about buying State-owned operations.

    The company may be expanding elsewhere in China, as well. Executives of China¡¯s leading machinery maker, Xugong Machinery, said last month Caterpillar was negotiating to buy a controlling stake in its construction machinery unit.

    (Source: Shenzhen Daily/Agencies)