China National Chemical Corp announced its plan of buying Pirelli, the world’s fifth largest tire maker, through a 7.1 billion euro ($7.7 billion) deal.

This deal with Italy's tire manufacturing industry shareholders on Sunday is the latest in a string of takeovers in Italy by Chinese buyers.

It is said that the cash-rich Chinese buyers are taking advantage of a weak euro just as signs emerge that Europe is coming out of economic stagnation.

The deal will give state-owned ChemChina, led by acquisitive chairman Ren Jianxin, an access to technology to make premium tires. Also, the deal will give the Italian firm a boost in the huge Chinese market.

The deal marks a return of China’s state-owned enterprises (SOEs) to global deal making following a pause prompted by President Xi Jinping's anti-graft crackdown that targeted several current and former senior SOE officials.

As per Thomson Reuters, it would be China’s fifth-biggest outbound deal by an SOE. Also, it will be its first major acquisition for China since its MMG Ltd (1208.HK) led a consortium last year to buy the huge Las Bambas copper mine in Peru from Glencore.

ChemChina's tire making unit China National Tire & Rubber will first buy the 26.2% stake that Italian holding firm Camfin owns in Pirelli. It will then launch a mandatory takeover bid for the rest.

Camfin said in a statement that the bid will be launched by a vehicle controlled by the Chinese state-owned group and part-owned by Camfin investors, who include Pirelli boss Marco Tronchetti Provera, Italian banks UniCredit, Intesa Sanpaolo and Russia's Rosneft.

The offer will be launched at 15 euros per share, valuing the group at 7.1 billion euros excluding net debt of almost 1 billion euros at the end of 2014.