Glencore has said it is no longer actively considering a merger with or offer for the shares of Rio Tinto.
Rio stated earlier on Tuesday October 7 that Glencore had approached it in July on the possibility of a tie-up but that it had rejected this approach in August.
Glencore is now subject to rule 2.8 of the City Code on Takeovers and Mergers, which means that it cannot make another offer for Rio for at least six months, and neither can it buy any interest in its shares.
“Glencore announces that in July 2014 it made an informal enquiry by telephone call to Rio Tinto, seeking to gauge whether there might be any interest at Rio Tinto in investigating some form of merger between the two companies,” the company said. “Rio Tinto responded that it was not interested in pursuing these discussions.”
However, Glencore has said it reserves its right to make an offer at some point in the future, with the consent of the UK Takeover Panel, following either a recommendation from Rio’s board, a third party offer for Rio, or a “material change in circumstances”.
Rio’s share price dropped markedly immediately following the announcement from Glencore, falling to 2,940 pence ($47.02) on the London Stock Exchange as of 15:04 BST, but was back up to 3,059 pence as of 15:43 – up from 2,996 pence as the market closed on Monday, but down from intraday highs of 3,177.7 pence.
See also:
Rio Tinto rejected merger approach by Glencore
Rio rejection of Glencore approach not the end of the story – analysts
Claire Hack
chack@metalbulletin.com
Twitter: @clairehack_mb