China aircraft maker plans to buy foreign peer: paper

SHANGHAI (Reuters) - China Aviation Industry Corp <AVIC), a newly-created state aircraft maker, plans to acquire a foreign general aviation aircraft maker to shore up its technology capabilities, state media said on Tuesday.

The deal is expected to be closed by the end of the year, China Daily said, citing Tan Weidong, president of AVIC's general aviation unit.

Tan did not identify the acquisition target or disclose the size of the acquisition when speaking to reporters on the sidelines of an airshow in the southern Chinese city of Zhuhai.

He added his firm, AVIC General Aviation Co, which aims to develop 20- to 30-seat business jets and turbo-prop hydroplanes, will go public in the near future, but did not elaborate.

Also at the airshow, Miao Wei, the country's industry and information technology minister, told reporters that the country planned to spend several hundred million yuan in the next five years to develop large aircraft which was expected to hit the market before 2020.

Beijing has merged its two state aircraft makers AVIC I and AVIC II earlier this year to pull resources for the big jet project as it moves to wean itself from reliance on Boeing Co and Airbus.

While welcoming foreign participation in the project, including parts supply, the country will also strive to make breakthroughs in core technologies on its own, the China Securities Journal said, citing Miao.

Preparations for developing passenger jets with more than 150 seats and freighter capable of handling more than 100 tonnes of cargo have already started and detailed design and experiments are scheduled to begin after 2010, Miao was quoted as saying.

Meanwhile, China has signed up a total of 208 orders for its first self-developed regional jet ARJ21, unveiled in late 2007.

(Reporting by Fang Yan, Editing by Jacqueline Wong)