China Medical Technologies, a China-based manufacturer of ultrasound products and in-vitro diagnostic systems, said it will buy the hybridization businesses of Supreme Well Investments Limited and Molecular Diagnostics Technologies Limited for $136.8 million.

China Medical Technologies said it will develop and commercialize the fluorescent in situ hybridization, or FISH, technology to diagnose prenatal and postnatal disorders.

FISH is a type of hybridization in which a DNA probe is labeled with fluorescent dye so it can be seen with a microscope. "With FISH, we believe we will be well-positioned to conduct prenatal testing of pregnant women in China with a leading technology that can return results in less than 24 hours as compared to the up to four weeks needed for karyotyping, the most comparable alternative," said Mr. Xiaodong Wu, chairman and chief executive of China Medical.

China Medical Technologies said it will pay an addition $40 million in cash or shares in the company when certain business and financial milestones are met. The company also said it will hold back $20 million of the initial payment in case of any claims if the companies breach their obligations under the agreement.

The deal is expected to close in March. China Medical Technologies shares fell six cents to $24.50 in after-hours trading after closing up 1 cent to $24.56 on the Nasdaq.

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