Summary
Allegheny Technologies Incorporated (ATI) announced on April 17, 2014, that it has decided to close its iron castings business, previously held for sale as part of discontinued operations. This decision follows the inability to complete a planned divestiture on commercially acceptable terms, as initially announced in October 2013. The company expects the orderly wind-down of the iron castings business to conclude by the end of June 2014. This closure will incur approximately $3 million in cash exit costs in 2014. Notably, around $2 million of these charges, primarily for severance benefits, will be recognized in the second quarter of 2014 and will be reported within the results of discontinued operations.
Key Highlights
- 1ATI to close its iron castings business, previously held for sale.
- 2The divestiture attempt announced in October 2013 was unsuccessful due to a lack of commercially acceptable terms.
- 3Orderly wind-down of operations expected to be completed by the end of June 2014.
- 4Approximately $3 million in cash exit costs are anticipated in 2014.
- 5Approximately $2 million of these costs, mainly for severance, will be recognized in Q2 2014.
- 6Costs will be classified under discontinued operations.
Frequently Asked Questions
ATI is closing its iron castings business because the planned divestiture through a sale process, announced in October 2013, could not be completed on commercially acceptable terms.
The company expects approximately $3 million in cash exit costs in 2014. Of this amount, roughly $2 million, primarily related to severance benefits, will be recognized in the second quarter of 2014.
ATI anticipates completing the orderly wind-down of the iron castings business operations by the end of June 2014.
The costs associated with the closure, including severance benefits, will be recognized as part of the results of discontinued operations.