Metals firm Alcoa will separate into two independent publicly traded companies during the second half of 2016. The split should qualify as a tax-free transaction for shareholders. Shartia Brantley reports.
Alcoa, the world's third largest aluminum maker, plans to split into two independent, publicly traded companies. One will focus on aluminum while the other will focus on high performance multi-material products for growth industries. The aluminum business will retain the Alcoa name… the other business doesn't have a name yet. This traditional aluminum unit has been hurt by a global supply glut which has hurt prices. Alcoa has recently made acquisitions to bolster its aerospace and automotive operations. Alcoa Chairman & CEO Klaus Kleinfeld summed up the move this way. "In the last few years, we have successfully transformed Alcoa to create two strong value engines that are now ready to pursue their own distinctive strategic directions." Kleinfeld will remain Chairman of Alcoa during its transition and will become the CEO of the new company. The split will be completed in the second half of 2016. And should qualify as a tax-free transaction for shareholders. Shares are up in early trading.