Glencore's Decade-Long Rio Tinto Pursuit Collapses in Dramatic 24-Hour Breakdown
For more than ten years, mining billionaire Ivan Glasenberg pursued what many considered the ultimate prize in the global resources sector: merging Glencore Plc, the massive commodity trader and mining operation he built, with industry titan Rio Tinto Group. This long-standing ambition represented what would have been one of the largest corporate combinations in mining history.
Months of Serious Negotiations End Abruptly
Throughout the past month, it appeared Glasenberg might finally achieve his goal. The two mining giants were engaged in merger discussions for at least the fourth time, with participants noting these talks were more serious than previous attempts. However, as a deadline approached for Rio Tinto to submit a formal bid, the entire negotiation process unraveled in less than twenty-four hours.
The companies continued discussions right up to the final moments on Thursday, attempting to find common ground on valuation. Around 3 p.m. U.K. time, Rio Tinto decided to terminate negotiations after Glencore insisted on receiving 40 percent of the combined entity. Executives concluded that extending talks would be futile given the fundamental disagreement over terms.
High-Stakes Industry Context
This failed merger represents the latest in a series of attempted takeovers within the global mining industry. The stakes were exceptionally high for both companies when formal negotiations began in mid-December. Glencore had experienced a more than 40 percent decline in copper production over the previous decade, just as copper prices reached record highs. The company was working to convince investors it had successfully turned around its operations.
Meanwhile, Rio Tinto—which prides itself on operational excellence—saw an opportunity to unlock growth potential within Glencore's copper portfolio. Without such a deal, Rio's earnings would remain heavily dependent on the iron ore market, where prices were declining due to increasing supply and weakening demand.
What the Mega-Deal Would Have Created
A successful combination would have allowed Rio Tinto to surpass BHP Group as the world's largest mining company. The merged entity would have incorporated Glencore's substantial coal and copper operations along with its commodity trading division into Rio's massive iron ore business. Crucially for Rio, the deal would have doubled its copper production capacity, potentially establishing it as the world's leading copper miner while adding approximately one million tons of future growth potential.
Leadership Dynamics and Previous Attempts
Previous efforts to merge Glencore's aggressive mining and trading culture with Rio Tinto's more conservative corporate approach had failed quickly. However, with competitors also pursuing significant copper acquisitions, the risks of inaction were growing and the opportunity became too substantial to ignore.
Glencore's current chief executive, Gary Nagle—who succeeded Glasenberg in 2021—initiated informal contact during the summer of last year with Simon Trott, a Rio Tinto veteran who had recently assumed the CEO role. After this preliminary engagement, formal negotiations accelerated in December, with Rio chairman Dom Barton also playing a prominent role in the discussions.
This detailed account of how the US$240 billion mining mega-deal collapsed is based on conversations with multiple sources familiar with the confidential negotiation process. Representatives for both Rio Tinto and Glencore have declined to comment publicly on the failed merger discussions.
