THE head of Sinochem will also take over at ChemChina in a move expected to signal the long-rumoured merger of the two chemicals firms. Such a tie-up would create the world’s largest chemical company, with annual revenue exceeding US$100bn.
Financial publication Caixin reported on Saturday that Sinochem chairman Ning Gaoning will also take over from ChemChina chair Ren Jianxin, who is expected to retire this year. The Wall Street Journal now reports it has seen an internal memo corroborating the news, and attributing the change to the state-owned Assets Supervision and Administration Commission. Beijing is keen to streamline its state-owned companies in a bid to compete internationally.
Rumours that the two would merge first circulated in 2016 but were dismissed by the companies and regulators as ChemChina sought approval for its now completed US$44bn takeover of Swiss agribusiness Syngenta. Both the Financial Times and the Wall Street Journal report that the companies have not responded to requests for comment.
“The personnel change at the top clearly signals a step closer toward the merger between the two giants,” Liu Qiang, an analyst at Pacific Securities, told the Wall Street Journal.
The combined annual revenues of the merged firms would exceed US$100bn, compared to US$79bn at DowDuPont and US$75bn and BASF.