Rio Tinto Group and Glencore Plc are expected to ask the UK Takeover Panel for an extension to the merger deadline, according to people familiar with the situation. The reported move comes as the two companies continue to work through disagreements over how the proposed transaction should be priced.
The firms have been negotiating since early January on a deal that, if completed, would produce an entity with an estimated market value of about $235 billion and position it among the largest copper producers globally. Both companies remain interested in pursuing the combination, but differences over valuation have impeded progress.
Sources indicate that Glencore is seeking a premium that reflects its position as the smaller participant in the potential tie-up, while Rio Tinto shareholders are focused on ensuring that the company adheres to a disciplined approach to mergers and acquisitions. Those divergent priorities have been a central factor in prolonging discussions.
The prospect of an extension to the deadline signals that neither side has reached a price arrangement acceptable to both parties. Market observers and industry participants have noted that resolving such valuation gaps can require additional negotiation time, which the Takeover Panel can grant when requested.
This potential transaction would be the latest example of large-scale consolidation attempts within the mining sector, as executives aim to grow copper exposure and build enterprises large enough to draw greater investor attention. If finalized, the deal would represent the largest-ever transaction in the mining industry by size.
For now, the companies appear committed to continuing talks, but the precise timing and terms remain uncertain until any extension is requested and further negotiations yield a mutually acceptable valuation. The outcome will determine whether the parties can bridge the current divide over pricing while maintaining the financial discipline that stakeholders expect.
Key points
- The two miners are likely to seek more time from the UK Takeover Panel to continue merger discussions.
- The proposed combined firm would have an estimated market value near $235 billion and would rank among the largest copper producers.
- Valuation disagreements - notably Glencore seeking a premium and Rio Tinto shareholders’ emphasis on financial discipline - have slowed progress.
Risks and uncertainties
- Continuing disagreement over pricing could delay or prevent a deal - this impacts the mining and commodities sectors.
- The need for an extension introduces timing uncertainty, which may affect investor sentiment in mining equities and related markets.
- If valuation gaps remain unresolved, the transaction may not proceed, leaving both companies to reassess strategic options.