Digital China to spend $66 mln on Japan IT firm

TOKYO, Nov 4 (Reuters) - Digital China Holdings (0861.HK) and its affiliates will invest as much as 6 billion yen ($66.4 million) in Japanese system developer SJI Inc (2315.Q), underlining the growing appetite for overseas M&A among Chinese firms.

Digital China, an information technology distributor unit of Legend Holdings, which is also the parent company of PC maker Lenovo (0992.HK), will take a maximum 40.9 percent stake through the deal, SJI said on Wednesday.

The move, aimed at bolstering Digital China's advanced systems technology, will also help SJI expand its sales network in China and tap growing demand, SJI said in a release.

Digital China Holdings and its affiliates will buy shares in a private placement or stock warrants, it said.

Through the capital tie-up, Digital China Holdings aims to gain access to advanced systems technology from Japan to help it obtain orders from Chinese financial institutions, communications firms and government entities.

SJI, whose shares jumped 10 percent to a calendar year high on Wednesday, aims to boost its earnings by expanding its sales network in China, where demand for systems development is growing strongly along with the economy. (Reporting by Mayumi Negishi; Editing by Hugh Lawson)