Tech giant Microsoft has announced that its Microsoft Online division, formerly known as MSN China, has reached an agreement with Xichuang Technology for a buyout. The deal would make Microsoft Online one of the subsidiaries of Xichuang Technology. Moreover, Microsoft Online General Manager Liu Zhenyu would also become the new chief executive officer of Xichuang Technology.

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Microsoft confirmed the news via its official blog. The company added that it is forming close ties with Xichuang Technology to implement a new operating model that would help the company's Internet search advertising business. This is to make sure, that despite the buyout, Microsoft's core businesses and partnerships would remain intact.

According to China Tech News, the Microsoft and Xichuang Technologies deal took effect on Aug. 10.

Along with this new announcement, Microsoft also said that China would be one of the company's biggest market. To capitalize on China's booming tech industry, Microsoft is making a long-term investment in the country.

Microsoft's China operation is the company's largest research and development facility outside of the United States. By establishing its roots in the country, and forming alliances with local tech firms, the company can create more personalized computing products, build smart cloud platforms that address the needs of local companies, and reestablish core strategies to move forward into the market.

Microsoft officially renamed MSN China to Microsoft Online in October 2014. Along with the rebranding, Microsoft also shifted its strategy to focus online products and business in the Chinese market, along with providing advertising solutions that are based on local demands.

TagsMicrosoft, MSN China, Microsoft Online, Xichuang Technology, china