Italian sportswear company Lotto Sport Italia has signed a 20-year licensing deal with China's Li Ning Company Ltd to produce and distribute Lotto brand products in China.

The agreement, which begins in September 2008, raises Lotto's profile in China and also gives sportswear company Li Ning an opportunity to secure a footing at the more expensive end of the market.

It will see Lotto's products sold in monobrand stores and counters in the most prestigious department stores in China's largest cities.

Lotto Sport Italia has set itself a target of more than EUR60m in sales in China by 2013 through at least 600 Lotto stores around the country.

Andrea Tomat, president and chief executive officer of Lotto Sport Italia, said: "China represents a key market for all companies so it is naturally at the centre of Lotto's worldwide expansion activities."

Lotto currently has a direct presence in the Asian market through its Lotto China Ltd joint-venture and will continue to distribute its own products through its subsidiary Lotto Sport HK Ltd in Hong Kong and Macau.

With headquarters in Beijing and offices and logistics centres throughout China, Li Ning Company was named after its namesake founder, one of China's most famous gymnasts.

Li Ning is the third largest sportswear brand operating in China, with sales of EUR400m in 2007 and a goal of more than EUR600m.