A STANDSTILL preventing Rio Tinto from approaching Glencore about a takeover expires this week, but those briefed by senior executives do not expect renewed merger talks soon, said Reuters.
Instead, Rio Tinto’s CEO Simon Trott will concentrate on cost cuts and asset sales, the newswire added.
Trott, who took charge of the world’s second-largest listed miner a year ago, has pursued a simplification strategy built around three core businesses, said Reuters.
He weighed a potential $200bn combination that would have paired Glencore’s marketing and copper assets with Rio’s operational strength, but then concluded there was no compelling case. Merger talks were abandoned talks on 5 February, triggering a six-month standstill under UK takeover rules that ends on Tuesday.
“The company got a pretty clear message back when talks were on, that they shouldn’t go there,” Michael Bell of Solaris Investment Management, a Rio shareholder, told Reuters. A revival of that deal would hurt the share price, he added. Three people said Trott had reassured Australian investors there was no reason to reconsider, reported Reuters.
Glencore shares have risen 33% this year against an 18% gain for Rio, a shift analysts say reduces the likelihood of renewed interest, particularly given Glencore’s coal exposure versus Rio’s focus on aluminium, lithium and copper.
Trott’s priority is unlocking over $10bn through divestments, targeting half by year-end, while pursuing bolt-on copper deals. Analysts note Rio’s limited copper growth beyond 2030 remains an unresolved strategic challenge.
