The surge in coal prices becomes the "strongest assist": Rumors suggest Glencore (GLNCY.US) plans to restart the $240 billion "merger of the century" with Rio Tinto (RIO.US).

Three informed sources said that Glencore (GLNCY.US) CEO Gary Nagle hopes that the recent rise in coal prices will help rekindle BHP (RIO.US)’s interest in creating the world’s largest mining company.

Earlier this year, the two companies held talks to build a company with a market value of $240 billion, aiming to combine Glencore’s marketing business and copper assets with BHP’s operational expertise to meet rapidly growing demand for the metal. However, the discussions ended last month without an agreement; under relevant UK regulations, BHP is not allowed to reopen negotiations with Glencore within six months.

The three investors said Nagle is optimistic about the prospects for another chance to reach an agreement.

It is reported that Glencore believes BHP’s valuation of the company is tied to spot prices of key commodities such as coal, which were publicly discussed on January 7, ( the day before the negotiations were disclosed, and that a more prudent approach to assessment should also take forecast prices into account.

Since January 7, coal prices and Glencore’s share price have surged by 26%, while BHP’s share price has risen by 9%, and iron ore prices have fallen slightly.

At present, in the combined market value of the Glencore-BHP merger, Glencore’s share is about 35%, higher than 31.5% at the time when the negotiations were publicly announced, and closer to the 40% stake that Glencore is rumored to have sought in a deal rejected by BHP.