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EghtesadOnline: Japan's top oil refiner by sales, JX Holdings, and third-ranked TonenGeneral Sekiyu are set to finalize details on Wednesday for a new merged company to be formed in April 2017.

Both companies said the planned merger will be discussed at their board meetings on Wednesday and that they will make an announcement promptly once the agreement has been finalised, reports Reuters.

The two firms agreed last December to merge in April 2017 to create a dominant player in a refining market that is in long-term decline.

JX Holdings President Yukio Uchida will head the new company which would likely be named JXTG Holdings, while TonenGeneral Sekiyu President Jun Mutoh will become vice president, the Nikkei business daily and Yomiuri newspaper said on Tuesday.

JX Holdings Chairman Yasushi Kimura will be chairman of the new company, the Nikkei added. The two firms said those details have not been set yet.

The companies said last year they planned to announce the details of the merger including the share swap ratio by the end of this month.

The merged firm, which would control more than half of domestic gasoline sales, will need approval from the Japan Fair Trade Commission.

The Japanese government has been encouraging consolidation in its refining sector, where five big refiners and three smaller ones are vying for business from a shrinking population that is increasingly opting for more fuel-efficient vehicles.

Domestic rivals Idemitsu Kosan Co and Showa Shell Sekiyu KK have also been planning to merge next April but the plan has been facing strong opposition from the founding Idemitsu family.

oil refiner JX Holdings TonenGeneral Sekiyu