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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 deal, which was under discussion as recently as this week according to people familiar with the matter, 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 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 tonne, underscoring 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, according to people familiar with the matter, although the exact contours of a potential deal could not be determined.
It is unclear whether Glencore’s extensive trading operations would be included in any merger. The talks could still falter with the companies choosing not to proceed, warned people familiar with the matter.
The talks restarted late last year and are still at a preliminary stage, according to people familiar with the matter. Rio Tinto and Glencore declined to comment.
Switzerland-based Glencore has recently rebranded itself as a copper growth company, with chief executive Gary Nagle telling investors in December that it would become the “biggest copper producer in the world”.
The company is currently 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.
Rio and Glencore previously held deal talks in late 2024, but these ended over issues including valuation, the chief executive, and the future of Glencore’s coal mines.
Since those talks ended, Rio has appointed a new chief executive, Simon Trott, who took over in August. Trott has focused on cost-cutting and streamlining, and has put several assets including Rio’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 Glencore examined last year.
Rio got out of 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 has gained 41 per cent over the same period.
Speaking to reporters in December, Glencore’s Nagle 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.”