One of Australia's biggest companies is in talks to merge with another mining giant.
Rio Tinto and Glencore are considering an all-share merger, a move which would turn the two mining companies into a $300 billion behemoth.
Rio Tinto is a British-Australian company headquartered in both London and Melbourne and publicly listed in both companies.
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Glencore is an Anglo-Swiss company.
Both have substantial mining operations in Australia.
The two companies had been in talks last year, but those discussions ended without an agreement.
In a market statement this morning, Rio Tinto confirmed new talks were underway.
"There can be no certainty that an offer will be made or as to the terms of any such offer, should one be made," the statement read.
Under the merger agreement, Rio Tinto would engage in a formal takeover of Glencore.
Rio Tinto has until February 5 to announce a "firm intention to make an offer for Glencore" or to announce it won't make a deal.
"A further announcement will be made in due course as appropriate," the statement read.
The merger would create the largest copper mining business in the world.
Rio Tinto's shares on the ASX dropped more than five per cent after the announcement.
Glencore is Australia's largest coal producer, operating in NSW and Queensland.
It also has copper interests in north Queensland, zinc and lead mines in North Queensland and the Northern Territory, and nickel and cobalt in Western Australia.
Rio Tinto's Australian operations span across every state but South Australia.
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Both companies also own embattled smelters in Australia, with Glencore's Mount Isa copper smelter receiving a bailout from the federal and Queensland governments last year.
Rio Tinto's aluminium smelter in Tomago was given a support package late last year.
Tomago Aluminium was founded in 1983 and produces up to 590,000 tonnes of aluminium per year, making it the country's largest smelter.
Both Rio Tinto and Glencore have major operations elsewhere around the world.
The larger of the two businesses, Rio Tinto has a market capitalisation of $202 billion.
Glencore's market capitalisation is about $98 billion.
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