Morrison & Foerster (MoFo) has advised on the largest ever foreign purchase of shares owned by the Chinese Government, in a groundbreaking instruction for the San Francisco firm.

The deal saw MoFo client Eastman Kodak take a 20% stake in China Lucky Film, China's largest photographic film maker, for $100m, as part of a strategic alliance between the two corporations.

Despite its modest value, the agreement has been hailed as a breakthrough for foreign investors in China.

The agreement was highlighted by the Chinese Government's Assets and Supervision and Administrative Commission as a key deal for attracting increased foreign investment into the country's corporations, such as PetroChina and China Telecom.

The MoFo team, led by Hong Kong-based partners Xiaohu Ma and Rupert Li, advised Kodak on the strategic agreement, which will see Kodak and Lucky Film sharing resources.

The top-50 US firm was the only foreign legal practice on the deal.

Ma told Legal Week: "This is a significant deal for the market, but there are lots of similar-sized deals in the pipeline."