China's two large state-owned industrial-chemical companies will be led by a single chairman, signaling their likely merger, the Wall Street Journal reported July 2.

Sinochem Group Chairman Ning Gaoning has been named to also lead China National Chemical Corp. Ltd. or ChemChina, the report said, citing a Sinochem internal announcement July 2.

The Sinochem announcement did not indicate when Ning would assume the ChemChina chairman role. The current ChemChina chairman, Ren Jianxin, is expected to retire in 2018, the Journal said.

A Sinochem-ChemChina merger would form the world's largest chemicals company with annual revenue of about $136 billion, according to the report.

"The personnel change at the top clearly signals a step closer toward the merger between the two giants," the Journal quoted Liu Qiang, an analyst at Pacific Securities in Beijing, as saying.

Liu added that the two companies' merger would lower the financial risks to ChemChina's debt-fueled $43 billion acquisition of Swiss agriculture company Syngenta AG and would be in line with Beijing's push to make state-owned firms more globally competitive.

Since 2015, China has been consolidating its heavily indebted state-owned enterprises in industries such as energy, mining, railways, shipping and steel to improve efficiency and address overcapacity, the Journal said.