The owner of holding company Recon Group has agreed a deal reported to be worth £60m with American billionaire Randy Lerner, who put the Midlands outfit up for sale in 2014.
The takeover is subject to approval from the Football League and the Premier League.
Villa were relegated from the top flight this season with just 17 points from 38 games and will play in the second-tier Championship, under the jurisdiction of the Football League, in 2016-17.
Xia would take a 100pc stake in the club and replace Steve Hollis, who helped broker the sale, as chairman. According to a club statement he is targeting a return to the Premier League, followed by a top six finish, and aims to make Villa ‘the most famous club in China’.
His immediate priorities will be the appointment of a new manager for the first team, following the sacking of French boss Remi Garde and sporting director Hendrik Almstadt in March, and the rebuilding of an off-field operation which has been hit by the departures of the likes of chief executive Tom Fox and directors David Bernstein and Lord Mervyn King.
Lerner, who bought Villa for £62.2m in 2006, wrote in a farewell message: “Tony has built his career around infrastructure. He is certainly a hugely successful businessman but importantly for me he is passionate about architecture, site design and planning.
“His commitment to invest in the squad, and leadership at Bodymoor Heath was expressed early on but as we visited together, and had some unrushed time to discuss his plans, Tony’s excitement to develop Villa Park shone through.
“I remain convinced that this is a crucial part of the club’s future as it provides a critical, long-term second source of revenue and therefore sustainability for the club from which squad-funding can potentially come.
“It is with that that I want to say thank you, and to wish Tony every success going forward.’
Recon Group, according to Villa’s statement, owns a controlling interest in five publicly listed companies on the Hong Kong and Chinese stock exchanges, as well as other businesses, employing 35,000 people in 75 countries.