(Adds context on Alcoa's strategy, market reaction)
Aug 25 Aluminum producer Alcoa Inc said
on Monday it will permanently close its Portovesme smelter on
the Italian island of Sardinia.
The closure of the plant, which has not operated since
November 2012, will reduce Alcoa's global smelting capacity by
150,000 metric tons to 3.6 million metric tons per year.
Aluminum producers are cutting production and closing plants
as they struggle with low prices, high energy costs and rising
production in China.
The company said it expects aftertax restructuring charges
linked to the closure of between $170 million and $180 million,
or 14 cents to 15 cents a share, in the third quarter. The
charges will be approximately 60 percent noncash.
As part of its push to cut costs, Alcoa has idled or
permanently shut down a number of aluminum smelters over the
last two years. In July it finished closing down the 51-year-old
Point Henry smelter in Australia, cutting 190,000 tonnes of
At the same time, Alcoa is pushing to reinvent itself as a
manufacturer of specialty components for the aerospace and
automotive industries, including some that contain no aluminum
at all, a generally higher-margin business. Its shares are up
more than 50 percent year to date.
Shares added 0.1 percent at $16.47 on the New York Stock
Exchange on Monday.
(Reporting by Swetha Gopinath in Bangalore; Editing by Ted
Kerr, Chizu Nomiyama and Jeffrey Benkoe)