Rio Tinto Group is in talks to buy Glencore PLC to create the world’s biggest mining company with a combined market value of more than US$200 billion, a little over a year after earlier talks between the two collapsed.
The companies have been discussing a combination of some or all of their businesses, including an all-share takeover, they said in separate statements on Thursday.
A tie-up between the two companies would represent the largest-ever deal in an industry that has been gripped by takeover fever as the biggest producers seek to bulk up on copper — a crucial metal for the energy transition that is trading near record highs. Glencore and Rio both own large copper assets, and the potential deal would create a new mining behemoth to rival BHP Group, which has long held the title of the biggest miner.
Photo: Bloomberg
The move comes after Rio CEO Simon Trott last month said the miner would focus on cutting costs and selling assets in a bid to turn into a slimmed-down operation centered primarily on iron ore and copper. Trott, who ran Rio’s iron ore division before taking the helm in August last year, aims to sharpen an organization that critics say became bloated in recent years.
“This is Simon’s first test as CEO and I would expect his disciplined approach to be carried through to M&A [merger and acquisition],” said John Ayoub, a portfolio manager at Rio shareholder Wilson Asset Management. “Coal is where a lack of detail is evident. You would think that coal would be one of the first divestments a merged company looks at, but we are all shooting from the hip today.”
Rio and Glencore held discussions in 2024, but the talks were abandoned after they failed to agree on valuation. Since then, Rio replaced its CEO, while Glencore made an effort to publicly outline its copper growth prospects.
The talks come at a time when copper has never been hotter. The metal soared to record highs above US$13,000 a tonne earlier this week, driven by a slew of mine outages and moves to stockpile the metal in the US ahead of possible tariffs from US President Donald Trump.
For Rio, a deal with Glencore would significantly expand its copper production and give the company a stake in the Collahuasi mine in Chile, one of the world’s richest deposits, and one that it has long coveted. While Rio already owns large copper assets, it and larger rival BHP both still get a substantial share of their earnings from iron ore, a market that faces an uncertain demand future as China’s decades-long construction boom is drawing to an end.
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