(Bloomberg) -- China has approved a merger of two coal miners to create a new giant in the world's top producer and consumer of the fuel.
Yankuang Group Co. Ltd.'s merger with fellow miner Shandong Energy Group Co., which was announced in July, has been approved by authorities, a Hong Kong-listed unit of Yankuang said Friday in a filing.
Creation of the new firm, Shandong Energy Company Ltd., is among the latest steps by Beijing to concentrate coal production in large, efficient firms in an effort to better regulate and streamline the industry. Despite global efforts to stem use of the most polluting fuel, its abundance and low cost in China have put it on course to dominate its power sector for years to come.
A consolidation of the two firms, both owned by the Shandong Provincial State-owned Assets Supervision & Administration Commission, would create the nation's second-largest coal miner, analysts at Morgan Stanley said in July, with total output of 291 million metric tons a year.
China Energy Investment Corp. is the country's largest producer at 510 million tons. Yankuang and Shandong also had a combined revenue of 638 billion yuan ($92 billion), based on their latest annual data.
©2020 Bloomberg L.P.
With assistance from Bloomberg
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