Crop and Food Research and Hortresearch are to merge on December 1 into a new Crown Research Institute.
Minister of Research, Science and Technology Pete Hodgson said that the merger would go ahead subject to Commerce Commission approval.
NZPA reported last month that the two big science companies - split off from government departments in 1992 - had political approval to look at merging.
Mr Hodgson said the "bold and exciting" merger would combine the two CRIs' strength in plant-based food research capabilities.
"The merger will combine the two companies' knowledge and expertise in nationally significant areas of sustainable production, elite genetics and smart breeding, and food and health, which will benefit wider national initiatives and strategies," he said.
"The critical mass created through the merger will allow the combined CRI to better service key client needs, combine complementary skills, and share equipment."
Mr Hodgson said there were no plans to close any sites but staff would be brought together in some areas.
Jim McLean, current chairman of HortResearch has been appointed as chairman.
A name for the new CRI will be announced before December.
HortResearch has 541 staff and in 2007/08 earned revenue of $65 million. Mr Hodgson said it was an acknowledged world leader in integrated fruit research and its cultivation successes included the zespri gold kiwifruit and enza jazz apple.
Crop and Food Research has 380 staff and in 2007/08 earned revenue of $56 million. Its key research focus was producing and transforming high-quality raw materials into high-value foods.
The two companies were among 10 crown research institutes set up in 1992. The poorly funded Institute for Social Research and Development fell over in 1995, but nine survived.
A decade after the restructuring, the Government's "Knowledge Wave" push in 2002 was followed by the biggest science company, Agresearch, making an abortive bid for a super-merger with Hortresearch, Crop and Food Research and Forest Research.
Agresearch claimed that the sectoral split of state science companies reflected what New Zealand used to do historically rather than what it would be doing in future.
Hortresearch said at the time that it needed to "guard very, very strongly against loss of focus", and Crop and Food said the benefits of co-operation could be gained by working together on specific projects without a full merger.