Rio Tinto, Glencore end merger talks over price dispute

Rio Tinto Ltd(LSE:RIOASX:RIOOTC:RTNTF) View Price & Profile Rio Tinto, Glencore end merger talks over price dispute

Published: 12:57 05 Feb 2026 EST

Rio Tinto Ltd (LSE:RIO, ASX:RIO, OTC:RTNTF) and Glencore PLC (LSE:GLEN) said on Thursday they have ended merger discussions after failing to agree on terms, marking the collapse of what could have been one of the mining sector’s most high-profile deals.

Rio Tinto said it is no longer considering a merger with Glencore, citing an inability to reach a deal it believes would deliver value to shareholders.

Under the UK Takeover Code, Rio must now wait at least six months before making a firm offer for Glencore, and it cannot participate in competing or joint offers unless a third party announces a formal bid or Glencore’s board consents.

Glencore’s board highlighted concerns over governance, noting that Rio retaining the roles of chairman and CEO in a merged entity would “significantly” undervalue Glencore’s contribution, making the deal unsuitable for Glencore shareholders.

The announcement sparked a sharp selloff in Glencore shares, which fell more than 10% in London initially, while Rio’s shares were largely steady.

Analysts at Jefferies said that while large-scale mergers in mining are challenging due to cultural, regulatory, and geopolitical factors, the strategic logic for a Rio-Glencore combination had been clear. Jefferies noted that Glencore’s insistence on a significant stake and control over the combined company was a key stumbling block.

“Price and governance disagreements were at the heart of the breakdown,” Jefferies wrote. “While a future re-engagement is possible, our base case is that Rio will focus on its standalone strategy.”

Following the failed talks, Rio Tinto is expected to refocus on its internal priorities, including $650 million of annualized productivity gains targeted by the end of the first quarter of 2026 and an opportunistic cash release of $5-10 billion from existing assets. The company also plans to maintain dividend payouts of 40-60% and continue reducing net debt, which stood at $14.6 billion in the first half of 2025.

Glencore, meanwhile, could explore alternative strategies to unlock shareholder value, including potential demergers in its coal business, new M&A opportunities, or expansion of its copper portfolio.

Analysts said copper production remains a key focus for both companies, with Rio aiming to increase output from around 850,000 tonnes in 2026 to 1 million tonnes by 2028 and 1.6 million tonnes by 2035. Glencore has projects that could meet these targets, but execution will be critical.

Jefferies reiterated a “Buy” rating on Glencore following the share price decline, while maintaining a “Hold” on Rio Tinto.