The company to be formed through a merger between major oil refiners Idemitsu Kosan Co. and Showa Shell Sekiyu K.K. will be led by Idemitsu President Shunichi Kito, company sources said Tuesday.

Idemitsu Chairman Takashi Tsukioka and Showa Shell President Tsuyoshi Kameoka will become board members with representation rights in the newly merged company to be launched in April.

Masakazu Idemitsu, a major stakeholder and grandson of company founder Sazo Idemitsu, is under consideration as an outside board member, along with a corporate lawyer of the oil wholesaler, according to the sources.

The companies said 0.41 of an Idemitsu share will be exchanged for one Showa Shell share, and that they will aim to save a total of ¥60 billion ($536 million) over the three years through fiscal 2021 through the integration of operations. That target is up by ¥10 billion from a previous projection in July.

The founding family of Idemitsu, Japan's second-largest oil refiner, had initially opposed the merger with the fourth-ranked Showa Shell, citing differences in corporate culture.

But the family later gave its approval on condition that its members would sit on the board of the merged company.

Idemitsu has long been known for a unique management style that treats employees as family members rather than staff.

Even after the integration, the oil refiners will continue to use their old names and brands.

The merger and the plans for the new management lineup are expected to be officially approved at extraordinary shareholders meetings in December, the sources said.

Japanese oil refiners have been facing a decrease in demand for petroleum products in their home market. Once the merger takes place, Japan's oil wholesale sector will be dominated by the newly merged firm and industry leader JXTG Holdings Inc.