Dongbei Piano Group, China's third-biggest piano maker, was founded in 1952 and is located in the northeastern Liaoning Province; it reportedly produces up to 40,000 pianos a year.
Gibson, which entered the mainland Chinese market in 2002, produces up to 150,000 guitars a year for export at a factory in eastern Qingdao city; in 2003 the company set up a unit in Shanghai to promote its brands, according to Shanghai Daily.
Gibson also makes Baldwin pianos, a popular brand in China, as well as its cheaper Epiphone guitar models, at a factory in southern Guangdong Province which it bought in 2004.
According to Reuters, Gibson will pay several hundred million yuan for the purchase of the Dongbei Piano company. (One U.S. dollar currently equals about eight yuan.)
Reuters quotes an unidentified source as saying, "The Chinese factory can help Gibson reduce its global production cost and definitely boost its brand reputation in China."
Western music was frowned upon during the Cultural Revolution, but in recent years China has seen huge rise in interest in Western classical music. Musical education is on the rise, providing a healthy market for instrument manufacturers.
According to a statement quoted by Shanghai Daily, sales of Baldwin pianos in China have been rising 60% a year, while Steinway has also reportedly seen its China sales rise 15% annually in the past three years.