China National Chemical Corp., known as ChemChina, agreed Monday to buy German machinery maker KraussMaffei Group from Canadian private equity firm Onex Corp. in a deal valued at 925 million euros ($1.01 billion). The acquisition would help China’s biggest chemicals company upgrade its expertise in manufacturing plastics and rubber, the company said in a statement.

China's state-run company will team up with Chinese investors Guoxin International Investment Corp. and AGIC Capital for the deal, which is expected to be concluded by the first half of the year. 

The purchase would be China’s biggest acquisition in Germany until now, ChemChina said, adding that the 178-year-old KraussMaffei would contribute significantly to ChemChina’s chemical machinery business and fit in with the Chinese government’s broader plans to upgrade its manufacturing sector over the next decade.

ChemChina said it would retain KraussMaffei’s current headquarters in Munich and expand its workforce in 2016. The company has about 4,500 employees worldwide, of whom 2,800 are based in Germany. Following the acquisition, KraussMaffei would also “considerably accelerate” its growth strategy in China and Asia, the German company said in a separate statement.

“The growth potential of the KraussMaffei Group is tremendous, especially through improved access to the Chinese market, which we can make possible,” ChemChina Chairman Ren Jianxin said in the statement.

ChemChina has developed an appetite for top European brands in recent months. The company made a bid for a majority stake in Swiss pesticide and seeds maker Syngenta AG in December and bought Milan-based Pirelli in a deal that valued the Italian tire maker at $7.7 billion.   

“With ChemChina, we have found a strategic and long-term oriented investor who has been interested in our company for many years,” KraussMaffei CEO Frank Stieler said. KraussMaffei generated sales of about 1.1 billion euros ($1.2 billion) in 2014 and is expected to achieve year-on-year revenue growth of approximately 10 percent for 2015.

The German machinery maker was bought by Canada’s largest private buyout firm Onex Group in December 2012 for 276 million euros ($301.4 million).

"Upon completion of the transaction, the Onex Group will receive proceeds of approximately 670 million euros. Onex’ portion of the proceeds will be approximately 180 million euros, including carried interest of 12 million euros," the Toronto-based group said in a statement.