(Yicai Global) Dec. 17 -- Chinese cleaning appliance maker Chunguang Technology will invest USD3 million to buy Vietnam's Suntone Technology to expand its business in the vacuum cleaning market.

Chunguang, its unit in Singapore, as well as Suntone and its shareholder Ng Yu Shu Andy penned an equity transfer agreement yesterday, the Jinhua-based buyer said in a statement the same day.

Founded in southeastern Vietnam early this year, Suntone counts Chinese home appliance giant Midea Group as one of its clients. The Dong Nai province-based firm made VND4.7 billion (USD202,500) in net profit in the first three quarters this year, according to the same statement. It can produce 1.5 million vacuum cleaners per year.

Chunguang already makes vacuum parts in Vietnam. The acquisition will help Chunguang extend its industrial chain to complement its existing assets while enhancing its core competitiveness and profitability, the statement added.

The widening assets failed to buoy the buyer's stock price. Chunguang's equity price [SHA:603657] slid 2.1 percent CNY18.82 (USD2.90) this morning.

Editor: Emmi Laine