Glencore and Rio Tinto resume talks on $260bn mining megadeal

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Glencore and Rio Tinto have restarted talks over a potential megamerger to create the world’s largest mining company, nearly a year after previous deal discussions between the global miners collapsed.

The potential deal would create a mining behemoth with an enterprise value of more than $260bn, at a time when the race for copper is reshaping the sector.

The two groups on Thursday separately confirmed they were in “preliminary discussions” about a “possible combination of some or all of their businesses, which could include an all-share merger between Rio Tinto and Glencore”.

The statements, published shortly after the FT revealed the talks, also noted there was no certainty any transaction would be agreed.

Rio Tinto — the larger of the two companies with an enterprise value of $162bn — would potentially acquire Glencore under the deal currently envisaged, they said.

Rio Tinto’s Australian-listed shares opened sharply lower after the company confirmed its talks with Glencore. The stock was trading down 4.5 per cent on the Australian Securities Exchange.

The recent combination of Anglo American and Canada’s Teck Resources — a friendly deal done at zero premium — has put pressure on rivals such as BHP and Rio Tinto to bulk up as miners vie to secure access to more copper resources.

Copper prices this week hit an all-time high of more than $13,300 per tonunderscoring a market shortfall that analysts warn could reach 10mn tonnes by 2040.

A full combination of Rio Tinto and Glencore was one of the options under discussion, said people familiar with the matter, although the exact contours of a potential deal could not be determined. The talks restarted late last year, the people said.

It is unclear whether Glencore’s extensive trading operations would be included in any merger.

Switzerland-based Glencore has recently rebranded itself as a copper growth company, with chief executive Gary Nagle in December saying it would become the “biggest copper producer in the world”.

The company is the world’s sixth-largest copper producer and largest listed coal producer. Its expansion plans, which include developing a new copper mine, El Pachón, in Argentina, would lead to it producing 1.6mn tonnes of copper annually by 2035, roughly double current levels.

The pair previously held deal talks in late 2024but these ended over issues including valuation, the chief executive and the future of Glencore’s coal mines.

Since those talks ended, Rio Tinto has appointed a new chief executive, Simon Trott, who took over in August. He has focused on cost-cutting and streamliningand has put several assets including the company’s large boron mine in California under strategic review.

Meanwhile, Glencore has restructured its coal holdings into a separate Australia-based entity, a change it confirmed in May. Analysts said the new structure would make it easier to spin out the coal mines into a separate company, an option that the group examined last year.

Rio Tinto left the coal business years ago, selling its last mine in 2018. Analysts believe it may be reluctant to get involved with coal again.

Glencore’s share price has risen 35 per cent over the past six months, buoyed by rising commodity prices and its new copper strategy. Rio Tinto’s stock has gained 41 per cent over the same period.

Nagle in December said the mining industry lacked scale and relevance because of the size of its companies. “It makes sense to create bigger companies,” he said. “Not just for the sake of size, but also to create material synergies, to create relevance, to attract talent, to attract capital.”

Under UK takeover code rules, Rio Tinto has until February 5 to either make an offer for Glencore or state that it does not intend to do so.