Stockholders of the LTV Corp. and Lykes Corp. over-whelmingly approved a $7 billion merger of the two firms this morning that will create the nation's third largest steel company.

Final approval of the merger came at stockholders meetings of Dallas-based LTV in Dallas and Lykes in New Orleans.

LTV Chairman Paul Thayer blamed government regulations, environmental controls and federal inaction in the face of a flood of foreign steel imports for financial difficulties of the two firms' steel companies.

"This was the situation in which (LTV's) Jones & Laughlin sound itself ailing and (Lykes steel subsidiary) Youngstown (Sheet & Tube Co.) found itself failing," Thayer said. "So serious were the circumstances at Youngstown that Lykes made the decision to seek a partner or sell off its steel operations."

Thayer said LTV had not thought at first of a merger, but after examination found a combination with Lykes would be a "unique fit." In short, he said, "The strengths and weaknesses of the two steel operations dovetailed almost perfectly."

The two firms have been seeking since November 1977 to combine the two troubled steel companies to make a stronger, more-cost-efficient and more competitive organization. Company officials would not spell out a timetable for realigning steelmaking facilities, but said most adjustments would be made within a year. They emphasized that consolidating the two firms was not creating unemployment, but rather was saving jobs that might have been lost had the steel firms failed. Some 20,000 workers are employed by the Youngstown firm.

Specifically, the merger calls for LTV's J&L Steel Corp. and Lykes Youngstown's Sheet & Tube Co. to be brought under one roof. Lykes Bros. Steamship Co. Inc. will join LTV's food processing company, Wilson Foods Corp., and its aerospace firm, Vought Corp., as subsidiaries of LTV.

Additionally, Lykes Continental-Emsco and LTV's J&L Supply will be consolidated as one oil and gas drilling equipment and supply firm to be based in Dallas. When merged, it will be one of the largest such firms, with some 3,000 employes worldwide.

Under the merger plan, each share of Lykes common stock will be converted into 1.1 shares of LTV common stock and 0.15 share of LTV participating preference stock; each share of Lykes series A preferred stock will be co converted into one share of LTV series B preferred stock and the right to receive $3.25 in cash; and each share of Lykes$4 series preferred stock will be converted into two shares of LTV series B preferred stock and the right to receive $5.20 in cash.

The Justice Department approved the merger in June, clearing the way for a stockholders' vote. Approval from Justice was required under the terms of a consent decree which terminated a suit brought against LTV by the government in 1969. Under that agreement, LTV is precluded from acquiring one percent or more of the voting securities of any corporation with assets of more than $100 million without first obtaining federal consent. The 1969 federal suit challenged LTV's acquisition of J&L.

In approving the merger, Attorney General Griffin Bell said that Lykes "faced a grave possibility of a business failure in the near future" if the merger was not approved.

LTV officials say the merger creates a company large enough to compete effectively with the so-called "second tier" of steel companies, which have steel market shares ranging from 8 to 10 percent. Companies such as Armco, Inland, National and Republic currently fall in that category, while U.S. Steel and Bethlehem, which together have 35 percent of the market, constitute the "first tier."

By operating in the second tier, the combined steel operations will be less susceptible to price cutting, imports and other market hazards, according to Julian Scheer, LTV senior vice president for corporate affairs.

Thayer and other company officials could not spell out any timetable for bringing about the merger and changes in operations. However, Scheer said by the end of 1979, the newly merged corporation should be able to begin taking full advantage of the combination.