Understanding M&A Momentum: How Rio Tinto's Second Swop Attempt for Glencore Could Reshape Commodities Markets

The commodities sector is buzzing following Rio Tinto’s return to the negotiating table with Glencore—a dramatic reversal after their merger talks collapsed two years ago over pricing disagreements. This time around, with copper prices hitting unprecedented levels, the dynamics have shifted substantially. The question now is whether valuation concerns that derailed the previous approach have finally been resolved.

Why Rio is Back at the Table: The Price Story

Two years prior, Rio Tinto’s attempt to acquire Glencore stalled primarily due to disagreement over what the target company was worth. Today’s environment looks markedly different. Surging copper demand and elevated commodity valuations have breathed new life into deal prospects, signaling that what once seemed impossible may now be feasible.

What makes this swop of strategic direction noteworthy is that Rio hasn’t limited itself to acquiring specific assets—management has left the door open to a full acquisition of Glencore, including its controversial coal operations. The breadth of potential scope suggests serious intent, not exploratory posturing.

The Market’s Immediate Reaction Tells a Familiar Story

When major acquisition news hits, equity markets respond in predictable patterns. Rio Tinto’s shares declined 2.5% as investors processed the increased capital commitment and execution risk. Conversely, Glencore shareholders celebrated, bidding up the stock more than 10% on speculation that Rio’s reopened offer could lead to a premium price.

However, these opening moves rarely tell the full story. Three critical factors will determine whether these early gains stick or reverse.

The Three Scenarios That Will Drive Price Action Forward

Deal completion uncertainty: If weeks pass without substantive progress announcements, Glencore’s rally could lose momentum. Investor enthusiasm tends to fade when deal momentum stalls, potentially eroding the target’s share price advantage while giving Rio breathing room as the acquirer premium diminishes.

Regulatory intervention: Authorities may block or force restructuring of the proposed transaction on competition grounds. Either outcome would pressure Glencore’s valuation and could limit Rio’s downside if regulators effectively kill the deal before it gains traction.

Successful negotiation and closing: If Rio and Glencore reach terms, the battle for price becomes paramount. Glencore will likely reject initial offers, creating a negotiating dynamic where each successive price increase simultaneously boosts the target’s equity value while potentially pressuring the buyer’s stock.

Lessons from the Warner Bros Acquisition Battle

The protracted struggle between Netflix, Paramount Skydance, and Warner Bros Group provides an instructive parallel. Despite fundamental differences in industry and deal structure, the share price patterns offer critical insights.

Since Warner Bros entered the market for buyers in October 2025, its stock has trended upward, though momentum has clearly decelerated. Over the past month, gains have slowed to just 3%, and the prior week saw a 1.6% decline—a telling sign that deal fatigue was setting in as negotiations dragged on without resolution.

Netflix’s December offer triggered a 6% monthly decline, suggesting investors penalized the acquirer premium. Paramount, having made an increasingly attractive bid, suffered even more severe damage with a 14% monthly sell-off as market participants priced in regulatory risks and extended negotiation timelines.

The Warner Bros precedent suggests that Glencore’s initial 10% surge could face erosion if Rio and Glencore don’t communicate clear milestones and timelines to investors. Deal speculation can drive sustained long-term price movements, but only if participants maintain confidence in eventual completion.

The Road Ahead for Rio and Glencore Watchers

Investors should monitor three specific developments: regulatory feedback from competition authorities, announcement frequency from either party, and any signals about price negotiations. If the Rio-Glencore swop moves quickly with transparent updates, both companies could reward shareholders. If momentum stalls, the initial reaction could reverse entirely, mirroring the Warner Bros pattern where extended uncertainty gradually wore down investor enthusiasm despite the deal’s apparent strategic logic.