Glencore's shares jumped sharply while Rio Tinto slipped after the two mining giants confirmed renewed, preliminary discussions about a possible combination that could reshape the industry.
Market ripple and the mechanics
Glencore's London stock rose about 10% on the day the talks were disclosed, a clear signal that investors see value — or takeover fever — in the reopened discussions. Rio Tinto, bigger by market value, traded lower as markets parsed the implications and the complex mechanics that would be needed to stitch two sprawling businesses together.
Rio Tinto's announcement framed the talks as preliminary and warned there is no certainty an offer will be made. It also set a regulatory clock: under the UK takeover rules Rio will have until 5pm London time on 5 February 2026 either to declare a firm intention to make an offer or to walk away. The company posted the full statement on its website here: Rio Tinto statement.
The parties said their current expectation is that any merger would be executed through Rio Tinto acquiring Glencore by way of a court‑sanctioned scheme of arrangement. That route can speed shareholder approval in some cases, but it also invites intense regulatory scrutiny across jurisdictions where both groups operate.
Why talks have revived
Several factors help explain why both firms would revisit the idea. Commodity markets have tilted in favour of metals crucial to the energy transition — copper in particular has been buoyant, even touching record highs this week — strengthening the strategic logic for building scale in base and battery metals. Consolidation also promises cost synergies and a bigger, more liquid public vehicle for investors.
But strategic fit is thorny. Glencore is not just a metals producer: it has a trading arm and significant thermal coal assets. Previous merger talks that collapsed in late 2024 reportedly foundered over valuation and the treatment of Glencore's coal business. Any deal now would need to square those same tensions: how to incorporate a division that sits uneasily with Rio's decarbonisation optics and with investor demands for cleaner asset bases.
Size and valuation talk
Headlines have put a combined valuation in the hundreds of billions of dollars. By one tally the pair would form one of the world's largest miners, with combined enterprise values cited in media reports ranging from roughly 190 to 260 billion dollars when debt and cash are included. Exact figures will shift as advisers crunch balance sheets and the parties decide which assets are part of any transaction.
If Rio were to pursue a deal, the mix of consideration could matter a great deal. The Rio statement makes clear the company reserves the right to introduce different forms of consideration or to vary the mix, so shareholders should expect detailed papers only if talks progress to a formal proposal.
Regulatory, shareholder and operational hurdles
A mega‑merger would face multiple hurdles. Regulators will probe overlaps in key commodity markets, national security and critical minerals supply chains, and potential concentrations of market power in trading. Shareholders on both sides will judge whether strategic rationale and synergies justify giving up independent positions, particularly given the reputational baggage associated with certain commodities.
Analysts and market participants also point to potential structural fixes that could make a deal palatable: carve‑outs or tax‑free spin‑offs for assets such as thermal coal, or retention of Glencore's trading platform as a separately listed entity. Those options are familiar from past deals but are complex to execute and can dilute the immediate financial uplift a combined group might promise.
Industry context
This is not an isolated bid for scale. The mining sector has seen recent consolidation moves — notably a large tie‑up between Anglo American and Teck Resources — as players race to secure scale in copper, lithium and other transition metals. Larger, diversified producers argue size helps smooth commodity cycles and unlock investment for capital‑intensive projects.
At the same time, investors are increasingly selective. They want exposure to transition metals but are wary of coal and other assets that complicate decarbonisation stories. That tension sits at the heart of any Rio‑Glencore conversation.
What to expect next
Right now the dialogue is preliminary and officially non‑binding. Expect a torrent of due diligence, multiple contingency scenarios for coal and trading assets, and intense engagement with advisers and regulators if talks deepen. Both management teams will be under pressure to show a clear rationale to their respective shareholders before anything more formal appears.
For markets, the immediate aftermath is simple: momentum stocks react, long lead‑time integration plans follow. For the industry, the bigger question remains whether this sparks a new wave of deals or simply reunites two companies long linked by scale and complementary footprints.