As the standstill comes to an end, Rio Tinto does not rush to revive Glencore as it signals that no hurry is needed.

The freeze on Rio Tinto approaching Glencore to takeover ends this week. However, those who have been briefed on the situation by top executives do not expect any new tie-up discussions for now. CEO Simon Trott is focusing on cost cutting and asset sales.

After he was appointed to the top position at Rio Tinto, the second largest listed miner in the world a year earlier, Trott implemented a strategy of simplification that aimed to reduce the company into three core businesses. He also focused on the most profitable assets.

In a few months, he had already run the numbers for a possible $200 billion mega-merger. The mega-merger would combine Glencore's copper and marketing assets with Rio Tinto operational expertise in order to maximize its copper potential.

Trott ultimately found no value in the case and the miner left on 5 February, triggering a six-month halt under UK takeover regulations that expires Tuesday.

"The company received a very clear message when the talks were going on that they should not go there. Michael Bell, Chief Investment Officer of Solaris Investment Management, Brisbane, which owns Rio shares, said that if Simon Trott began talks again, it would be a negative for the share price from a corporate-governance perspective.

Trott assured?Australian investors, according to three sources, that Rio Tinto had no reason to revisit discussions with Glencore.

Rio Tinto has declined to comment.

Bell continued, "The changes Rio Tinto made in the last few years, with aluminium and copper, are what people expect to see as a future growth driver, not a return of coal." Glencore is one of the top five coal producers in the world.

Three investors in March said that the recent surge in coal prices had given Glencore CEO Gary Nagle hope that Rio Tinto might be willing to reconsider creating the world's largest mining company.

Glencore is the one with the ball. Glyn Lawcock said that any?offer? of value must be vastly different from the one rejected six months earlier.

Glencore has declined to comment.

Glencore shares have risen 33% in value this year, compared to Rio Tinto shares which rose 18%.

Analyst Jon Mills of Morningstar said that the rally in Glencore shares "definitely reduces the chance that Rio will return." He added that it would dilute Rio shareholders and undermine Trott’s decision to walk away.

Trott's first priority is to liberate $10 billion or more through divestments. He aims to achieve half of this amount by the end of the year, while expanding trade and pursuing opportunities in copper.

Rio Tinto "should look to partner and bolt on," he said last week during a call with analysts.

Barclays analysts stated in a note that the only way to solve Rio's strategic challenge - that of a lack growth options for copper after 2030 - was through M&A.

GLENCORE WOOS AUSTRALIAN INVESTORS

Glencore has been focusing on its copper assets and increasing its visibility in Australia. It will host a conference call with Australian institutional investors including non-shareholders after it announces its?half year results on Wednesday.

The company's investor outreach came after it underestimated the impact Australian opposition would have on a possible merger with Rio Tinto due to its coal exposure, uncertainty around the value its marketing?business, and historical corporate governance issues.

BlackRock, the largest shareholder of both firms, has supported consolidation among large mining companies.

Glencore is weighing its options and a Sydney listing, along with other potential partners, remains an option.

In June, people familiar with Glencore’s thinking said that it was not impossible for the Swiss company to approach BHP and its new boss Brandon Craig, in order to have a friendly conversation.

BHP declined to comment. Craig has stated that BHP is focused on its own assets.

Bell, of Solaris, said that "Our position would be to not support a Glencore-BHP-Rio tie."

Two bankers confirmed that the talk of an Australian listing had died down. However, they did not say it was out of the question. A number of funds have expressed an interest in investing if Glencore decided to list Down Under.

(source: Reuters)