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Alcoa Declares Boards of Directors for Post-Split Companies

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Alcoa (AA - Free Report) has named the members of the boards of directors as it prepares for its planned separation into two standalone, publicly-traded companies. The aluminum giant, in Sep 2015, announced the separation of its smelting and refining business from those that cater to aerospace and automotive markets.
The separation will result in the creation of two independent, Fortune 500 entities –  “Arconic Inc.” and "Alcoa Corporation".

Post separation, Alcoa Corporation will be a highly competitive leader in bauxite, alumina and aluminum production with a world-class asset base including the world’s biggest bauxite mining portfolio. It will also have the world’s largest alumina refining system. Roy Harvey, the incumbent President of Alcoa’s Global Primary Products business, will be the CEO of Alcoa Corporation.

On the other hand, Arconic will be a leading provider of high performance multi-material products and solutions in attractive markets including the fast-growing aerospace market. The aerospace market represents roughly 40% of the pro-forma revenues of this business. Alcoa's CEO Klaus Kleinfeld will lead Arconic as Chairman and CEO after the separation.

Alcoa said yesterday that the boards of two new companies will include members of the existing Alcoa Inc. board who will serve alongside the new directors.

The board of Arconic will include former Medtronic Chairman & CEO Arthur Collins, Jr., Delphi Automotive Chairman Rajiv Gupta, former Merrill Lynch & Co., Inc. Chairman & CEO E. Stanley O’Neal, former TRW Automotive Chairman, President & CEO John Plant, Hewlett Packard Enterprise Chairman Patricia Russo, and Julie Richardson – former Partner and the head of the New York office, Providence Equity Partners LLC.

Alcoa Corporation’s board will include former KPMG CEO Timothy Flynn, former First Solar, Inc. CEO James Hughes, former Caterpillar Inc. Chairman & CEO James Owens, Suncor Energy Inc President & CEO Steve Williams, and Mary Anne Citrino – Senior Advisor at The Blackstone Group L.P.

The new boards will assume their responsibilities following the closure of the separation which is expected in the second half of 2016. The separation will mark the completion of Alcoa’s multi-year transformation. The split will allow both companies to pursue their own independent strategies and provide shareholders with value-creating investment opportunities.

Alcoa’s shares closed around 1% lower at $10.21 yesterday.

Alcoa is a Zacks Rank #3 (Hold) stock.
 
Better-ranked companies in the mining space include Coeur Mining, Inc. (CDE - Free Report) , Nevsun Resources Ltd. and Klondex Mines Ltd. , all carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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