Arconic Inc (NYSE:ARNC) reported the divestiture of its LAE business, which operates mainly in Brazil. The operation is part of the firm’s Transportation and Construction Solutions division. Following anti-trust and customary regulatory reviews, the LAE ownership will be moved to a subsidiary unit of Hydro Extruded Solutions AS. The agreement is projected to close in 1H2018. The divestiture is part of company’s continued drive to reorganize its business portfolio, lower complexity and further emphasis on its higher-margin offerings and continuous profitable growth.
Under the terms of the deal, Arconic will get cash of approximately $10 million for the LAE operation, contingent to working capital and related adjustments. As an outcome of the deal, the company will note a restructuring-related charge exhibiting the loss on sale of around $40 million after-tax, in Q4 2017, as stated in the firm’s third quarter filing. The charge mainly links to the non-cash damage of the net book value of the operation. The charge is stated as a special item and there will be no impact on adjusted EPS.
Arconic develops breakthrough offerings that shape industries. Working in close association with their consumers, they solve complex engineering problems to transform the way they fly, drive, power and build. Through the ingenuity of their people and latest advanced manufacturing know-hows, they offer these offerings at an efficiency and quality that ensure consumer success and shareholder value.
Hydro marks as a fully integrated aluminum firm with 35,000 staff in 40 nations, combining local expertise and global reach. Besides manufacturing of primary aluminum, extruded and rolled recycling and products, Hydro even extracts bauxite, generates energy and refines alumina to be the just 360° firm of the international aluminum industry. The extrusion operations, former Sapa, was completely bought by Hydro October 2017, and is a leader in unique aluminum solutions.