"We are now talking to several foreign companies. We might completely acquire (a company) or take a controlling stake. We hope to reach an agreement by the end of this year," said Tan Weidong, president of AVIC General Aviation Co Ltd, without revealing the names of the firms.

AVIC General Aviation also plans to list within the next three years, Tan said.

The company was set up last year to lead the development of general aviation airplanes. AVIC manages the Shanghai-listed Guizhou Aviation Industry Group Co Ltd, which produces trainers and unmanned aerial vehicles, and Shijiazhuang Aircraft Industry Co Ltd that manufactures light aircraft.

"We plan to form strategic partnerships with world leading manufacturers to develop more advanced general aviation aircraft, upgrade existing products and explore the overseas market," Tan said on the eve of the Aviation Expo/China 2009. The four-day expo started on September 23 in Beijing.

Zhuhai in Guangdong province will become the company's base for research and development, marketing, final assembly, test flights and customer service, Tan said.

The company will focus on developing light multi-purpose turboprop aircraft and business jets, Tan said.

General aviation refers to all flights other than military and scheduled airline flights. China had about 900 general aircraft by the end of last year, according to figures from the Civil Aviation Administration of China.

A major constraint on the industry is airspace inconvenience and a lack of air and ground services.