By staff reporter Cao Zhen

Blackstone, U.S. private equity giant, has completed purchase on a 20 percent stake in the Chinese chemical firm China National Bluestar Group Corp. (Bluestar). The deal signifies Blackstone's first significant foray into the Chinese market.

Blackstone has paid US$ 600 million for its Bluestar stake. It will now send managing directors Antony Leung and Ben Jenkins to join the Bluestar board, according to the company statement.

The two companies agreed on the deal early in September 2007 and won government approval in December last year.

A source closed to Blustar told Caijing in an earlier interview that the partnership with Blackstone will increase Blustar's capital flow. The company currently has a number of projects that have already passed primary experiments and are just waiting for capital support to start production.

Established in 1984, Bluestar is a subsidiary of China's leading state-owned chemical manufacturer, China National Chemical Corp. (ChemChina), which has until now owned all of Bluestar's shares. The company is a major manufacturer of new material and specialty chemical products in China, with total assets of 30 billion yuan.

Bluestar now owns three listed units – Blue Star Cleaner (SZSE: 000598), Shenyang Chemical Industry Co., Ltd. (SZSE: 000698), and Blue Star New Chemical Material Co., Ltd. (SSE: 600299). It also controls more than 10 non-listed units with a combined annual sales revenue of over 30 billion yuan.