ChenZhou Mining Group will acquire King Stone Minerals Group to expand its business into the zinc industry, according an official from Hunan province, China.

“The government-owned takeover group is expected to ink an agreement by the end of this year,” the official said.

The company will invest up to CNY500m ($73.79m) a year for three consecutive years to acquire the natural resource.

Chenzhou Mining’s annual sales are likely to reach CNY5bn in three years, if the acquisition takes place.

The group’s gold mines have been exhausted after 130 years of exploitation in the Hunan province and the gold output is estimated to rise 9% to 4.7mtn in 2010.