Bankers’ dreams of ten-figure paydays collapsed this morning as Glencore and Rio Tinto walked away from their megamerger — for the third time. This time, they’re blaming Britain’s takeover laws.
While CEOs in the US and other parts of the world are free to negotiate in secret, the UK’s “put up or shut up” code requires companies to quickly confirm their merger talks, and then either ink a deal, update investors, or walk away within 30 days.
Negotiating a $250 billion-plus deal with global operations and massive commodity risk is hard enough as it is. A ticking clock can make it near impossible.
Rio Tinto and Glencore had held only preliminary discussions about price when they were forced to disclose their flirtation in early January, a person familiar with the matter said. Both companies, in separate statements today, blamed a valuation mismatch. And there is, as is often true in M&A these days, a Trump wrinkle: Glencore’s agreed sale of its stake in some of its copper mines to a US government-backed company placed a higher valuation on the rest of its portfolio than Rio Tinto thought fair, this person said.