(Yicai Global) Dec. 12 -- Xilong Scientific Co. [SHE:002584] plans to buy a 70-percent stake in a molecular diagnostics company in East China's Shandong province to expand its market scope within biotechnology.

The firm penned a deal with Zhang Guoning, controlling shareholder of Shandong ACV Biotech Co., it said yesterday evening. The company is currently looking to expand from offering chemical reagents to providing biological reagents and electronic chemicals.

Molecular diagnostics is a high-tech area in the diagnosis sector. Its annual growth in China remains around 20 percent and it holds great potential for further expansion, the announcement quoted research reports as saying.

The pair agreed that qualified audit institutions will determine the target company's value by multiplying its net profit this year (excluding non-recurring profit and loss) by 18. Unaudited data put ACV Biotech's operating revenue at CNY46 million (USD7 million) from January through September, with net profit reaching CNY24.4 million.

Zhang Guoning holds a 73.1-percent stake in the target firm, Xilong said in its statement, without disclosing the expected shareholder structure after the transaction takes place.

ACV Biotech is a high-tech enterprise dedicated to developing technical services in clinical medicine, molecular diagnostics and gene detection, and high-throughput testing platforms, the statement added.