More than 50% of the sum will be invested in the share capital of a 50/50 joint venture, named Koncar-XD High Voltage Switchgear, which will operate a factory for high-voltage equipment of up to 550 kV in Croatia's Sesvetski Kraljevec, Koncar said in a statement.

Koncar and XD Electric signed the articles of association of the joint venture on Friday, the electrical equipment manufacturer said.

In June, the two companies signed an agreement to set up their joint venture, which will be based in Zagreb and will initially have about 50 employees.

China XD Electric Co., established in 1959, has 14,000 employees and is one of the world's leading producers of power equipment. It is listed on the Shanghai Stock Exchange.