During the dotcom bubble of the late 1990s, it was common to see old-school Chinese work units and staid State-owned companies transform themselves overnight into high-tech businesses. News from Hubei suggests the trend has not died.

Hubei Guochuang Hi-tech Material Co., Ltd. has agreed to acquire Shenzhen Yunfang Internet Technology Co., the operator of online real estate leasing and agency platform Qfang.com, for RMB380 million.

Shenzhen-listed Guochuang Hi-tech is an asphalt manufacturer and says it will raise RMB2 billion from eight investors, and plans to use the proceeds to pay for the transaction.

Founded in 2012, Qfang.com has been struggling as the online real estate business has been hampered by tighter regulations and China's property market faces uncertain government policies.

Competition among online realtors has become increasingly fierce as new entrants have emerged. Another online realtor Haowu.com was recently acquired by Zhejiang Ming Jewellery Co., Ltd for RMB2.4 billion.