"If we wait too long, our rivals will gain on us," he said.

"The country keeps the GDP growth rate above 7 percent each year. That requires enterprises like us to grow by more than 10 percent a year.

The company expected to boost both sales volumes and brand awareness by purchasing leading established foreign enterprises.

According to Cao's plan, the acquired companies would continue local production in developed markets like the US in the initial stage after the acquisition. But in emerging markets, including Southeast Asia and Eastern Europe, products under the same brand would be made in China.

"Gradually, we will win the midrange and high-end customers' trust."

Taotao was founded in 1985 as a foundry industry. In 1998, it spotted overseas market demand for ATVs and motorcycles, completed a product transition and transformed to an export enterprise. Now its products include electric vehicles, electric bicycles, wooden doors, steel doors, running machines, fitness equipment and garden tools. However, its ATVs and motorcycles account for half of Taotao's overall production value of $165 million.

Li Jian, researcher at the Chinese Academy of International Trade and Economic Cooperation of the Ministry of Commerce, said Chinese privately-owned firms had often sought acquisitions abroad since the global financial crisis.

"Enterprises engaged in auto parts production in the US were purchased by Chinese private groups who wanted to extend the industrial chain and grow profits," Li said. "It is also a shortcut to build and promote a brand."

Independent R&D took too long for Chinese firms, as foreign competitors had advantages in technology, brands, distribution channels, and the capital to sustain them.

Chinese private enterprises would also effectively avoid trade frictions with acquisitions, Li acknowledged.

However, he warned, Chinese private enterprises had to properly investigate their markets and apply internationally-accepted practices before and during acquisitions, rather than continuing to operate like family-run businesses.

Li said acquisitions would be a fresh driving force for Chinese private businesses with Southeast Asia taking a large number of production orders from Western enterprises.