China Minmetals Rare Earth Co confirmed on Thursday Chinese regulators have approved its merger with other state-run rare earth companies into one major corporation, Kallanish reports.

Upon receipt of the approval, a new company – China Rare Earth Group Co -- was established on 22 December in Ganzhou City, Jiangxi province. It consolidates China’s “Big Six” rare earth companies, increasing Chinese influence on global rare earth prices.

The new firm has a registered capital of CNY 100 million ($15.69m) and will be operated by State-owned Assets Supervision and Administration Commission of the State Council with a 31.21% share. The remaining shareholder structure consists of: China Minmetals Corporation (20.33%), Aluminium Corporation of China (20.33%), Ganzhou Rare Earth (20.33%), China Iron and Steel Research Institute Technology Group (3.9%) and Youyan Technology Group (3.9%). The subscribed capital contribution of each shareholder is the same amount of their equity interests in million yuan.

Activities of the giant enterprise, believed to be the largest rare earth company in the world, will cover the entire supply chain – from upstream to downstream, from mineral exploration and mining to smelting, processing, marketing and exporting rare earths. It will increase the global reliance on Chinese supply, with the Asian country already holding over 80% of the global rare earth processing capacity.

The merger is expected challenge Western companies and governments’ attempt to diversify its EV supply chain away from Chinese dominance.