Hong Kong listed companies Luen Thai, Fujian Fengzhu Group and Fujian Septwolves Industry Co have signed an agreement to invest $20 million in a new clothing manufacturing company in Jinjiang, south eastern China.

The new company, which will be called Jinjiang New Silk Road Garment Manufacturing, will be located at the Jinjiang Science and Technology Park and will produce clothing for foreign and Chinese companies.

Clothing manufacturer Luen Thai will invest $8.4 million in the project and will hold a 42 per cent stake in the company.

Chinese Fujian Septwolves Industry, which produces men's apparel, will invest $7.6m in the joint venture and will hold a 38 per cent stake.

Fujian Fengzhu Group, a leading knitwear manufacturer, will invest $4.0m and will own a 20 per cent stake in the new enterprise.