Alcoa shareholders OK reverse stock split
Alcoa Inc. shareholders on Wednesday approved a reverse stock split ahead of the company's plan on Nov. 1 to spin off its struggling mining and smelting business from its fast-growing aerospace and automotive parts manufacturing operations.
The reverse split, which shareholders approved during a special meeting in New York, converts every three shares of Alcoa common stock into one share. The move reduces the company's authorized shares of common stock from 1,800,000,000 shares to 600,000,000 shares, company officials said in a statement Wednesday.
Company officials in a July statement said the reverse split is “expected to increase the per-share trading price of the common stock, which may improve liquidity and facilitate its trading.”
The split precedes the planned breakup of the 127-year-old company into two publicly traded entities. The new parts company will be renamed Arconic and will be led by CEO Klaus Kleinfeld, who has pushed for the separation to maximize the high-growth parts of the business and free it from being weighed down by the less-profitable commodities operation. The legacy business will retain the Alcoa name.