Image credit: Alcoa
Alcoa announced it will permanently shut down its Rockdale operations site in Texas, which has been fully curtailed since the end of 2008.
The company will also divest its Portovesme primary aluminum smelter in Italy – closed since 2014 – to Invitalia, the Italian government agency that manages economic development.
Alcoa’s President and Chief Executive Officer, Mr Roy Harvey, said the actions support the company’s strategic priorities to ‘reduce complexity and to strengthen the balance sheet’.
“We continuously evaluate our portfolio of global assets against many factors to optimize value,” Mr Harvey said.
“Achieving a resolution on these two assets further streamlines our Company as we continue to execute against our strategic priorities.”
Alcoa’s Texas site includes a primary aluminum smelter and casthouse, an aluminum powder plant and associated buildings and equipment.
Earlier this year, the company carried out strategic review of these assets which concluded that the Rockdale operations have ‘limited economic prospects’.
“The Company will record an estimated charge of $55 million (pre- and after-tax) in the fourth quarter of 2017 associated with the permanent closure of Rockdale,” the company said in a statement.
“Cash outlays for the Rockdale closure are expected to be approximately $53 million over the next five years, including holding and demolition costs, with approximately $16 million in 2018. Cash outlays for the Italy settlement, including the pre-existing 148/2004 matter and remediation reserves, are expected to be between $40 million and $50 million over the next five years, with approximately $10 million in 2018.”
