Rio Tinto, Glencore In Talks To Form World’s Biggest Miner

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 $200 billion, a little over a year after earlier talks between the two collapsed.

The companies have been discussing a potential combination of some or all of their businesses including an all-share takeover, they said in separate statements on Thursday. Glencore’s American depositary receipts rose 8.8% in New York. Rio Tinto shares fell 5% at the start of Sydney trading.  

A combination of 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. 

However, analysts have previously raised questions about potential hurdles to a deal. Glencore is one of the world’s biggest producers of coal — a business that Rio Tinto has previously exited — while the two companies have very different cultures.

Rio and Glencore held discussions in 2024, but the talks were abandoned after they failed to agree on valuation. Since then, Rio has replaced its CEO, while Glencore has made an effort to publicly outline its copper growth prospects. In private conversations, Glencore CEO Gary Nagle has described a Rio-Glencore tie-up as the most obvious deal in the industry. Still, the gap between the two companies’ valuations had widened since the prior discussions.

The talks come at a time when copper has never been hotter. The metal soared to record highs above $13,000 a ton earlier this week, driven by a slew of mine outages and moves to stockpile the metal in the US ahead of possible Trump administration tariffs. That has played into an already existing focus among mining executives and investors that future supplies of the metal are going to be tight as a dearth of new mines fails to meet the expected demand from artificial intelligence and surging defense spending.

For Rio Tinto, 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 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.

Rio’s new CEO, Simon Trott, has so far focused on cutting costs and simplifying the business, and the company has vowed to offload some of its smaller units. Chairman Dominic Barton has signaled that Rio has moved on from a series of disastrous deals in its past, saying the company will be more open-minded when it comes to making acquisitions.

The fresh talks come amid a wider wave of dealmaking in the sector, most recently with Anglo American Plc’s agreement to buy Teck Resources Ltd., after Anglo successfully fended off a takeover attempt from BHP.

Glencore itself has been one of the most aggressive dealmakers in the industry in the past, including an audacious proposal to combine with Rio Tinto in 2014 that was led by former CEO Ivan Glasenberg, who still owns about 10% of the company.

More recently, Glencore has come under growing pressure from investors as its stock underperformed last year, pressured by weak coal prices and as it faced questions about its strategy. The company has made its copper mines central to its business and CEO Nagle last month laid out plans to almost double production of copper over the next decade.

While Glencore’s copper assets are likely to be the primary attraction, the company is also the world’s biggest coal shipper. It also mines metals such as nickel and zinc as well as having a giant trading business.

It is unclear if Rio would want to buy all of those assets and businesses. Glencore had previously proposed separating its sprawling coal unit, before shareholders told the company they wanted to keep them.

Under UK takeover rules, Rio has until Feb. 5 to confirm it will make an offer or walk away for six months.

“Agreement on terms and structuring won’t be straightforward. Rio wants Glencore’s copper assets but not its coal portfolio, we believe, though such assets could be carved out,” Bloomberg Intelligence analysts Alon Olsha and Grant Sporre said.