The much talked about demerger is finally complete. Alcoa Corporation has spun off from its parent company Alcoa Inc- now named and listed on the New York Stock Exchange (NYSE) as Arconic Inc (ARNC). Launched as a global leader in precision engineering, multi-materials innovation, and advanced manufacturing, the new standalone company will begin trading today on NYSE.
According to an official release, the separation took effect on November 1, Tuesday, through a pro rata distribution by Arconic Inc. of 80.1% of the outstanding shares of the newly-formed Alcoa Corporation. Alcoa Inc. shareholders receive one share of Alcoa Corporation common stock for every three shares of Alcoa Inc. common stock held as of the record date of October 20, 2016. Alcoa Inc. shareholders also retain their shares of Alcoa Inc., which become Arconic Inc. shares.
Already a strong entity in the advanced technology domain, Arconic is poised to serve the end user sectors it has been serving as Alcoa since years, especially aerospace, with all the more vigour, focus, and intensity. In 2015, the erstwhile SBUs that comprise today's Arconic generated around $12.5 billion revenues. Of this, approximately 65 per cent came from markets reflecting 'secular' growth and significant margins, including aerospace and automotive; the rest 35 per cent was attributed by markets comprising specialty and industrial products, and building and construction.
Aerospace alone, which accounts for almost 40 per cent of Arconic's total revenues, has been a key area of focus for the innovation-driven company. Since 2008, it has built on its capabilities through a combination of organic and inorganic technologies. As a result, it has gained significant dominance in the next-generation aero-engines and aero structures market. Today, Arconic is capable of supplying over 90 per cent of the structural components that go into the making of a jet engine.
In the automotive domain too, the company has grown its capabilities to become a name to reckon with for aluminium body whites and aluminium sheet that are becoming essential for automotive lightweighting.
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Arconic expects its North American automotive sheet revenues to grow six-fold, from $229 million in 2013 to $1.3 billion in 2018.
Commenting on the outlook Arconic Chairman and CEO Klaus Kleinfeld said, “Our multi-year transformation while part of Alcoa Inc. substantially improved our competitiveness and profitability. Today, we are very well positioned as a leader in attractive markets. Our culture combines driving innovation with a relentless focus on operational excellence and cost control; this positions Arconic to create significant value for our customers and profitable growth for our shareholders.”
"What I want this culture of Arconic to continue to be (is) the spirit of taking things on, changing things, not being afraid of the future, but rather creating the future... We can develop things that other people only dream of. Let's form Arconic into an icon."
The separation of Arconic from Alcoa was announced during September 2015.
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