Alcoa is separating to create a globally-focused cost competitive ‘Upstream’ company and an innovation and tech-driven ‘Value-Add’ company.
The lightweight metal specialist predicts the move will be complete in the second half of 2016.
The Alcoa Upstream Corporation will be renamed Alcoa Corporation and, as you might expect, will hold the Upstream side of the business. Alcoa Corporation will handle Bauxite, Alumina, Aluminium, Cast Products and Energy and rolling mill operations that will serve the North American packaging market.
The Value-Add business will remain in the existing company, to be renamed Arconic Inc. Arconic will focus on precision engineering and advanced manufacturing, providing a big range of multi-material solutions to growth markets like aerospace structures, jet engines, automotive and commercial transportation. It will include the Engineered Products and Solutions, Global Rolled Products, and Transportation and Construction Solutions segments.
“The filing of the Form 10 [with the Securities and Exchange Commission] is an important milestone as we prepare to launch two businesses that are well-positioned for success,” said Klaus Kleinfeld, Alcoa Chairman and Chief Executive Officer. “Alcoa Corporation has a low-cost base that will enable resilience and value-creation at all stages of the commodity cycle. Arconic is a technology-driven company producing performance materials and highly engineered products for growth markets, poised to deliver consistent profitable growth. Through our multi-year transformation, we have substantially re-positioned each business and laid the foundation for future long-term success. The separation will allow each new company to pursue its own distinct corporate strategy and unlock the full value of each business.”