Glencore and Rio in talks to form world’s biggest miner

[NEW YORK] Glencore and Rio Tinto Group are in talks about a US$207 billion deal that would create the world’s biggest mining company, a little over a year after earlier talks between the two companies collapsed.

Glencore said on Thursday (Jan 8) that it was in preliminary talks with Rio, with options including an all-share transaction that would see Rio buy the company. Glencore said there’s no certainty of a deal, adding that a further announcement will be made as appropriate. Rio confirmed talks in a separate statement.

Glencore ADRs rose as much as 9 per cent and Rio Tinto ADRs fell as much as 3.9 per cent on Thursday in US trading.

The fresh talks come amid a wave of dealmaking in the sector as the biggest miners look to bulk up on copper, a crucial metal for the energy transition that is trading near record highs. Teck Resources and Anglo American agreed to merge last year, while BHP Group has made attempts to buy Anglo.

After failing to reach an agreement in 2024, Glencore continued to work behind the scenes with its bankers on what a potential deal with Rio could look like, Bloomberg has previously reported.

Management has taken steps to prime Glencore to be able to move quickly, and Glencore chief executive Gary Nagle has repeated in private conversations that it’s a transaction that should get done, describing a Rio-Glencore tie-up as the most obvious deal in the industry.

Since the previous talks collapsed – primarily around valuation – Rio has replaced its CEO, while Glencore has sought to convince investors – and possible buyers – of its plans to grow its copper business.

Copper 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 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 fail to meet the expected demand from artificial intelligence and surging defence spending.

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

Both Glencore and Rio own some of the best copper mines in the world. However, Rio – like BHP – still depends heavily on iron ore to drive its profits, at a time when China’s decades-long construction boom is drawing to an end and the iron ore market appears headed for an extended period of weakness.

Glencore has made those copper mines central to its business. After years of disappointing investors with missed targets and falling copper output, the company late last month laid out plans to almost double its production of the metal 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, a commodity that Rio exited years ago. Glencore also mines metals such as nickel and zinc as well as having a giant trading business.

Glencore’s former CEO Ivan Glasenberg, who spearheaded an earlier approach to Rio in 2014, still owns about 10 per cent of the company.

The Glencore-Rio deal was under discussion as recently as this week, the Financial Times reported earlier Thursday, citing people familiar with the matter that it did not identify. BLOOMBERG