Alcoa separation expected Nov. 1
WEATHERSFIELD – A plan by lightweight metals producer Alcoa Inc. to split into two independent, publicly traded companies has been approved by its board of directors.
Alcoa Corp. will concentrate on serving the North American packaging market by focusing on upstream products, including aluminum. The second company, Arconic Inc., will focus on engineered products for its automotive and aerospace segments.
Alcoa’s local plant in Weathersfield, formerly RTI, will become part of Arconic Inc. Operations there are expected to continue as they have been.
The separation is scheduled to take effect Nov. 1 before the market opens, the company announced Thursday.
Upon separation, Klaus Kleinfeld will serve as Arconic chairman / CEO; Michael Morris will become non-executive chairman of Alcoa Corp.; and Roy Harvey, current group president of the Alcoa Global Primary Products business, will be its CEO.
On the New York Stock Exchange, Arconic’s ticker symbol will be ARNC and Alcoa Corp. will trade as an independent company under the ticker symbol AA.
Earlier this year, Alcoa Inc. announced plans to undertake a reverse stock split of its common stock at a ratio of 1 for 3 and a proportionate reduction in the number of authorized shares of its common stock.
Alcoa Inc. will hold a special shareholder meeting Wednesday to seek approval of the reverse stock split and authorized share count reduction.
If the reverse stock split is approved, at the time of separation Alcoa Inc. shareholders will receive one share of Alcoa Corp. common stock for every three shares of Alcoa Inc. common stock held as of Oct. 20, the record date for the distribution. At the time of separation, shareholders of Alcoa Inc. will retain their shares of Alcoa Inc. Due to the name change of Alcoa Inc. to Arconic Inc. upon separation, those shares will become Arconic Inc. shares.
The century-plus-old metals maker, which announced the separation about a year ago, had been dealing with a downturn in its smelting business because of lower aluminum prices. The split is part of a wider movement by companies to spin off units in a bid to boost shareholder value. Often, the strategy helps free the stronger part of a company’s business from a weaker segment.
Alcoa acquired RTI International Metals last year, including the Weathersfield plant that once served as RTI’s headquarters. Alcoa, which is based in New York with significant operations in Pittsburgh, has been an industrial presence in the U.S. economy for well over a century, dating its founding as the Pittsburgh Reduction Co. in 1888.