Li Shufu, founder of China's largest private carmaker Geely, is acquiring a 79.01 percent stake in domestic smartphone maker Meizu as vehicles he described two decades ago as "sofas on wheels" are becoming smart devices on roads.

Now the entrepreneur likely sees vehicles more akin to both sofas and living rooms.

Hubei Xingji Shidai Technology Co Ltd, established by Li in September, agreed to purchase stakes from two of Meizu's shareholders, according to a document published by the State Administration for Market Regulation on Monday.

The value of the deal remains unknown. Li owns an over 57.8 percent stake in the company, which has a registered capital of 715 million yuan ($106 million), said Tianyancha, a corporate information provider.

Established in 2003, Meizu was once one of China's best-known smartphone brands but has in recent years lost ground to local rivals including Xiaomi, Oppo and Vivo.

"There is a close connection in technologies within intelligent vehicle cockpits and smartphone software technologies," said Li in a statement speaking of his entry into the phone-making segment.

He said smartphones and other mobile devices allow users to enjoy the fruits of innovation "in the quickest manner possible" and can also act as pathways to wider technological applications in vehicles.

Beginning with United States-based Tesla, both electric and gasoline-powered automakers across the world have made big touch screens a must in their models.

Via Bluetooth and 5G, the vehicles' onboard operating systems now allow drivers and passengers to do on the dashboard displays whatever they can do on their smartphones, from watching videos and navigating to making phone calls and enjoying music.

"The major trend in the coming future is to create user ecosystems across borders and provide users with a more convenient, smarter and seamlessly connected multiscreen experience," Li said.

Xingji Shidai, based in Wuhan, Hubei province, won two patents for smartphone design in April.

It told National Business Daily on Monday that there is not yet a specific timetable for product development and launches.

The company said it will increase investment in research and development and does not rule out the possibility of acquisitions and joint development.

Geely said Xingji Shidai can make use of the carmaker's experience in design, R&D, manufacturing, industrial chain integration, smart vehicles, software development and global infrastructure, including its planned low-orbit satellite network.

Zhang Xiang, an auto analyst and researcher at the North China University of Technology, said as automakers offer similar large displays and functionality, the infotainment content available on such displays and user experiences are becoming key differentiators.

"Smartphones and smart vehicles can be part of the same big mobile internet system, so it does make a difference for automakers to explore the smartphone segment," Zhang said.

Chinese electric car startup Nio is planning to make inroads into the smartphone sector as well.

"The reason is simple. We simply want to offer our car owners the best smart phone-car user experience," said William Li, founder and CEO of the New York-listed startup, in an interview earlier this year.