Rio Tinto and Glencore in talks to create world’s largest mining company – business live

16 hours ago 14

Coal could be a potential stumbling block in these latest Rio Tinto/Glencore talks.

Rio divested itself of the dirty, polluting fossil fuel in the last decade; in 2018 it became the only major global mining company to have no coal assets.

Glencore, though, is one of the world’s largest producers and exporters of seaborne traded thermal and steelmaking coal.

Rio and Glencore also held talks in 2024 about a possible tie-up, but were unable to reach agreement on issues such as valuation.

Since then, Rio Tinto has appointed a new chief executive, Simon Trott, who has been focusing on cost-cutting and asset sales.

John Ayoub, a portfolio manager at Rio shareholder Wilson Asset Management, says (via Bloomberg):

“This is Simon’s first test as CEO and I would expect his disciplined approach to be carried through to M&A.

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Talks are underway to create the world’s largest mining company.

Rio Tinto is in talks to buy rival Glencore, a move which could create a company with a combined value of over $200bn (£152bn).

The two companies confirmed in statements overnight that they have been discussing a potential combination of some or all of their businesses, which could include an all-share takeover.

Both companies hold significant copper mines, which are profiting from prices hitting record levels; a combination could create a powerful rivalt to the world’s largest miner, BHP Group.

Glencore told shareholders:

Glencore notes recent media speculation and confirms that it is in preliminary discussions with Rio Tinto plc and Rio Tinto Limited about a possible combination of some or all of their businesses, which could include an all-share merger between Rio Tinto and Glencore

The parties’ current expectation is that any merger transaction would be effected through the acquisition of Glencore by Rio Tinto by way of a Court-sanctioned scheme of arrangement.

Rio Tinto confirmed that the two companies have been “engaging in preliminary discussions about a possible combination of some or all of their businesses”, and that any merger transaction would involve it buying Glencore.

The two companies have previous; back in 2014, Rio rejected a merger approach from smaller rival Glencore.

The mining sector is no stranger to talkover talks, and indeed failed approaches! BHP has been rebuffed in its attempts to take over rival miner Anglo American, which is itself taking over Teck Resources.