Chinese firms Sinochem and ChemChina are reportedly talking about possibly merging.<br /><br /> Both Reuters and Bloomberg quoted people familiar with the matter as saying meetings and due diligence moves are ongoing. <br /><br /> A ChemChina spokesperson said: “There is no such thing,” when asked about a merger and Sinochem spokesman said he was not aware of the discussions. <br /><br /> If it happens that would create a giant with annual revenue of around 90 billion euros, making everything from refined oil products to latex gloves and insecticides.<br /><br /> China’s central government is currently trying to reduce the number of state-owned companies consolidating them so they are more competitive globally.<br /><br /> This all coming as as ChemChina finalises a $43 billion (39 billion euro) takeover of Swiss pesticides and seed group Syngenta and could create issues with competition regulators. <br /><br /> Syngenta declined to comment on the reports.<br /><br /> President’s plan<br /><br /> A merger would fit in with President Xi Jinping’s years-long push to shrink the number of centrally-controlled state-owned enterprises (SOEs), which number more than 100.<br /><br /> Based on 2015 annual reports, revenues of the combined group would comfortably eclipse Germany’s BASF, the world’s largest maker of industrial chemicals by sales.<br /><br /> It would be a major global chemical giant and challenge domestic rivals Sinopec, PetroChina and CNOOC, said Michal Meidan, London-based China analyst with Energy Aspects.<br /><br /> “It really does align nicely the government’s priority to reduce the number of SOEs,” Meidan said.<br />
