(Adds Union comment.)

GRENOBLE, France (AFP)--French workers agreed Wednesday to release four managers held hostage for 24 hours at a bulldozer plant run by U.S. firm Caterpillar Inc. (CAT), and to resume talks on their demands.

Pierre Piccarreta, CGT union leader at the plant in the southeastern city of Grenoble, said talks would resume between workers, representatives from both Caterpillar's European and U.S. headquarters, and French state officials.

The breakthrough came after President Nicolas Sarkozy offered to meet union leaders from the plant to hear their demands for better compensation for the 733 workers facing redundancy.