Saudi International Petrochemical Co (Sipchem) said it was planning to resume proposed merger talks with Sahara Petrochemical in a deal that could create a 14.7 billion riyals ($3.9 bln) chemicals company.
The two companies called off a planned merger in 2014, citing an inadequate regulatory framework in the kingdom for the collapse.
Sipchem said it plans to resume discussions with Sahara about the merger after recent changes in the regulatory framework.
The proposed tie-up comes as consolidation gains momentum in the Saudi corporate sector. In other merger activity, Saudi British Bank and Alawwal Bank are in talks for a proposed merger in a tie-up that would create the third-largest bank in Saudi Arabia.