The move would create the world's sixth largest oil company, and the third biggest in Europe, after Royal Dutch Shell and the recently merged BP-Amoco.

Both Total and its French rival Elf Aquitane had been bidding for the Belgian company, which had been put up for sale by its biggest shareholder, the Belgian financier Albert Frere.

Petrofina, as a medium size firm, is finding it increasingly difficult to compete in a world where the major oil companies are merging in search of economies of scale. The weak oil price has also put pressure on the entire oil industry to rationalise or go under.

The new group will put particular pressure on Shell, which has recently announced a major restructuring plan after a big drop in profits.

Premium price paid

Total has acquired 41% of Petrofina through the purchase of stakes owned by its main investor.

And it intends to offer 9 Total shares for each 2 Petrofina shares to the remaining shareholders.

That would value Petrofina shares at 19,482 Belgian francs each - a substantial premium on its value two weeks ago of only 12,000 france a share.

The high price paid by Total is a sign of the urgency of the wave of consolidation in the industry.

Later on Tuesday the biggest oil merger of all, between Exxon and Mobil, is likely to be announced, creating a $238bn company.

Bidding war

Elf and Total, the eighth and tenth largest oil companies in the world, got into a bidding war with Mr Frere over the weekend to discuss a possible deal.

Although originally Elf was expected to be the buyer, Total entered the bidding war and is now the winner.

It may have over-paid, and it may be some time before the company gains any financial benefit from the move.

Many analysts consider that Elf would be a better fit, however, as its strength in exploration would complement the Belgian group's strength in refining and marketing.

Shares in Total soared on the Paris stock market, while the Belgian stock market is expected to rise strongly when it opens today.