(Yicai Global) July 24 -- Hebei-based Chinese film materials producer Lucky Film Co. [SHA:600135] plans to improve its competitiveness in the lithium-ion battery diaphragm (LIBD) market by taking over Xinxiang Zhongke Science and Technology Co. (XZST), an LIBD research and development firm.

Lucky Film said today that it has signed an equity transfer agreement with XZST shareholder Henan-based Xinxiang Zhongsheng Industrial Co. XZST will become a holding subsidiary of Lucky Film upon completion of the deal. The announcement did not specify the purchase price or the number of shares bought.

XZST was founded in 2002 and was one of the first Chinese companies to engage in the R&D, production and distribution of LIBD products, Lucky Film said. With nearly 600 employees, XZST has been granted 42 national patents for inventions and new practical technical solutions. The enterprise can independently develop innovative LIBD products.

XZST boasts sophisticated production techniques for wet and dry LIBDs, a large market share and industry influence, Lucky Film said.

Since film production is a sunset industry, Lucky Film has been looking to transform in recent years and has invested in the solar and LIBD industries. The company raised as much as USD89 million (CNY600 million) via private placement in 2014 and entered the market by pumping the money into high-performance LIBD projects.