After merger talks with diversified miner and trader Glencore fell short on valuation, diversified major Rio Tinto moved to emphasise that its copper growth strategy is already being delivered organically.

Speaking during a results call on Thursday, CEO Simon Trott confirmed that talks with Glencore covered the “full perimeter” of the business but ultimately stalled over valuation.

“We went under the hood with a singular focus on whether we could create value for shareholders,” he said in a call with analysts.

The discussions, Trott added, assessed Glencore’s underlying asset quality across all commodities, including coal, and whether a combined portfolio could generate incremental value.

“We had constructive discussions between the two teams. Ultimately, we concluded that we could not reach an agreement that would deliver value for Rio Tinto shareholders. Now, as you might recall at Capital Markets Day, I said we would look at M&A [merger and acquisition] opportunities through a disciplined lens, and that is exactly what we have done. This same focus on value will continue to guide us,” he said.

Trott stressed that valuation discipline, rather than strategic ambition, dictated the outcome.

“Strategic rationale does not pay the grocery bills. It's got to come back to cash accretion for Rio shareholders and that is the lens we took,” he said.

GROWING NOW
Trott highlighted that Rio’s copper growth was already visible. “The nice thing about the results today is we're growing now,” he said.

Trott pointed to the ramp-up at Oyu Tolgoi in Mongolia, delivering 8% copper equivalent growth, with a project pipeline to extend that beyond the 3% compound annual copper equivalent growth to 2030. Beyond that, the group has “options to extend that into the 2030s”.

Copper remains a “singular focus for the team”, he said, with an emphasis on converting existing project options into value-accretive developments.

Further, Rio executives flagged that productivity improvements are gaining traction across the group’s portfolio.

The company had previously announced a $650-million run-rate cost reduction target by the end of the first quarter. On Thursday, management said 2026 cash delivery would be “materially above” that $650-million run rate.

Trott said the programme followed a systematic, asset-by-asset review to identify “full potential” improvements and would run over multiple years, with further benefits likely in 2027 and 2028.

The cost-out effort spans all divisions, including iron-ore operations in the Pilbara, where unit cost guidance of $23.50/t to $25/t reflects ongoing productivity gains, partly offsetting currency headwinds.

Executives highlighted that recent quarters demonstrated how strongly the iron-ore system performed when volumes flow through replacement projects and bottlenecks were addressed.

Rio also reiterated that it had multiple avenues to release capital across the portfolio, including strategic reviews of certain businesses, infrastructure options and potential streaming arrangements. However, these would be assessed “systematically” and prioritised based on value.