Midea Group has acquired automation solutions developer Servotronix at a valuation of $170 million, the Israel-based company announced.

"We are proud that Midea has recognized our success, and we are confident that this strategic alliance will benefit the company, our customers and our employees. Servotronix will continue its operations with even more enthusiasm and strength," Dr. Ilan Cohen, founder and CEO of the Petah Tikva-based company, said.

Cohen further said that the deal will give Servotronix a strategic advantage in global operations. It will also provide the company a leadership position in the robotics, control, and automation industries, where China plays a major role.

On the other hand, Paul Fang, chairman and CEO of Midea, recognized the recent strategic deal "as another milestone of Midea's expansion."

"We believe that Servotronix' technological leadership and innovation in motion control will generate significant synergies... in terms of value chain integration and new market development," he said, adding that both companies are capable of creating new products and exploring growth opportunities by capitalizing on each other's abilities and resources.

Following the deal, Servotronix will continue to operate its development center. However, it is not yet clear how much controlling asset Midea will acquire. Cohen is poised to sell $26 million of its stake, while Ruth Wertheimer, another founder, is slated to sell its entire $56 million worth of shares. Other senior managers and employees will be giving up their shares as well.

Servotronix was first founded in 1987 and offers a range of automation solutions, particularly on motion control. The company, which operates worldwide, offers services from a range of market such as robotics, renewable energy, to name a few.

Chinese robotics and electronics giant Midea is valued at $28 billion and also offers products ranging from household goods and airconditioning units to robotics and automation.