Rio Tinto and Glencore held talks about combining their businesses

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Rio Tinto and Glencore held talks last year about combining part or all of their businesses, in an indication of how the push by mining companies to secure metals needed for the energy transition has focused executives on large-scale deals.

The London-listed companies engaged in early-stage talks as recently as October, according to people familiar with the matter, but the discussions did not progress to a deal. 

A full-blown merger between Rio and Glencore — which have market capitalisations of $103bn and $55bn, respectively — would rank among the largest ever transactions in the mining industry.

The talks between the two companies followed BHP’s failed £39bn bid for Anglo American last year, which prompted rivals to review strategic options.

BHP was interested in Anglo’s copper mines, among other things, because the metal is used in renewable energy projects and electric vehicles. 

Glencore and Rio both declined to comment. Bloomberg first reported that Rio and Glencore had discussed combining their businesses.

Demand for commodities required to decarbonise the global economy — such as copper, lithium and aluminium — has triggered a flurry of dealmaking activity in the mining industry over the last year. 

Rio last year announced a $7bn deal to acquire Arcadium Lithium, as it increases its presence in metals used in batteries for electric vehicles.

People close to the company said it was still digesting that transaction. 

An activist shareholder campaign is also pushing for Rio to move its primary listing from London to Sydney in order to enable more share-based deals in the future. 

Glencore, which has a large commodity trading business as well as mining operations, has been debating the future of its coal business. 

The company said in 2023 that it would spin out its coal mines into a separate listed business, but then changed its mind last year and decided to retain them. 

Rio rejected a takeover bid by Glencore in 2014.