As Syngenta deal closes, ChemChina and Sinochem press $120 billion deal

Chinese state-owned Sinochem and ChemChina are in merger talks to create the world's biggest industrial chemicals firm, to be headed by Sinochem chief Ning Gaoning, four people with knowledge of the negotiations said. A deal could be announced by the end of the year, the people said, potentially just months after ChemChina completes its own $43 billion purchase of Switzerland's Syngenta (SYNN.S), China's biggest overseas deal to date.A consolidation of Sinochem and ChemChina would be worth around $120 billion, one of the people said, topping companies like industrial chemicals giant BASF.Talks to create a Chinese chemicals powerhouse were first reported last year, but were dismissed by both companies as rumor. Combining Sinochem and an enlarged ChemChina would put the group among the world leaders across the competitive chemicals, fertilizer and oil industries - a giant overseas and a major challenger domestically to Sinopec (0386.HK) and PetroChina (0857.HK).Sinochem is larger than ChemChina, but needs a long-term partner to expand globally market from its roots as an oil and chemical trader.Sinochem's growth in its energy business has stagnated, with more competition at home in trading from companies including Unipec and Chinaoil, while its overseas oil and gas assets have struggled amid prolonged weaker oil prices.