Sanrio Co. Ltd.’s Shanghai subsidiary has inked a master license agreement with Hong Kong-based KT Licensing Ltd. for Mainland China, paving the way for the development of merchandise bearing the trademark of Hello Kitty and other Sanrio characters.

KT Licensing, which unveiled the deal Thursday, is owned by an investment vehicle of the families of Victor Fung and William Fung, the controlling shareholders of the sourcing and apparel manufacturing conglomerate Li & Fung Group. A Li & Fung spokeswoman said the agreement does not involve other Li & Fung subsidiaries.

The Fungs and Sanrio have a long history together, spanning more than 25 years, KT said, explaining that Fung vehicle Kanematsu Textile Corp. is a major supplier to Sanrio. Last  year, Fung Investment Pte. Ltd., the private investment arm of the Fung families, bought a minority stake in Sanrio.

“The China market has tremendous growth potential for Sanrio, and we welcome the opportunity to work with one of our oldest business partners in Japan to help them develop the brand in the Mainland by utilizing our extensive capabilities on the ground,” said Victor Fung, group chairman of the Li & Fung Group.