(Yicai Global) June 12 -- Japanese conglomerate Mitsui & Co. plans to pick up more than 30 percent of a Chinese vegetable seed firm Hunan Xiangyan Seed Industry for around USD20 million.

The sogo shosha will pay USD8 million to controlling shareholder Yuan Longping High-Tech Agriculture, a firm named after China’s ‘father of hybrid rice,’ the seller said in a statement today. Mitsui will also pay nearly USD12.2 million for a 10.4 percent stake from two individual shareholders, it added, saying Longping will retain a 60 percent share of the firm.

Shares in Longping [SHE:000998] closed down 1 percent at CNY16.06 (USD2.27) today.

Xiangyan Seed earned CNY12.4 million (USD1.8 million) on operating income of CNY46.3 last year, and the firm is particularly strong in China’s seed market for cabbage, sweet pepper, and broccoli, Longping said.

Mitsui and Longping will also join hands to share their related resources, seed-growing experience and technical and sales platforms to expand in the seed segment and promote the formation of a global seed commercial system, the statement added.

Yuan Longping founded Longping in 1999 with the Hunan Academy of Agricultural Sciences and other research organizations. It mostly grows seeds and develops agricultural technology, and is currently controlled by state-owned financial firm Citic Group.

Editor: James Boynton