China approved a merger between the country’s top two chemical companies

China approved a merger between the country’s top two chemical companies, paving the way for another supersize state-run enterprise that Beijing hopes will become a dominant global player.

Sinochem Group Co. and China National Chemical Corp., also known as ChemChina, will be placed under a new holding company funded and overseen by a government body that holds state enterprises, according to a Sinochem statement Wednesday, confirming a Wall Street Journal article in December. The Chinese body, called the State-Owned Assets Supervision and Administration Commission, controls both enterprises.

The combination, which has been in the cards for years, would minimize competition between the two companies and create the world’s largest chemicals conglomerate with around 1 trillion yuan in annual revenue, equivalent to about $153 billion.