8-KOther Events

Howmet Aerospace Inc. 8-K Report, Corporate Update (Aug 26, 2019)

Filed August 26, 2019For Securities:HWM

Summary

Howmet Aerospace Inc. (under its former name Arconic Inc.) filed this 8-K to announce the divestiture of its aluminum rolling mill located in Itapissuma, Brazil. The sale to Companhia Brasileira de Aluminio for approximately $50 million is expected to close by the first quarter of 2020, subject to customary conditions. This transaction is a strategic move, aligning with Arconic's stated intention to exit non-core businesses. Investors should note that the company anticipates recognizing a pre-tax restructuring charge of $40 million to $50 million in the third quarter of 2019, primarily due to the non-cash impairment of the asset's net book value. While the sale price is subject to adjustments, it provides a clear indication of the asset's value in the market. The filing also includes standard forward-looking statements and risk factors, which investors should review for a comprehensive understanding of potential future impacts and uncertainties.

Key Highlights

  • 1Arconic Inc. (now Howmet Aerospace Inc.) is selling its aluminum rolling mill in Itapissuma, Brazil.
  • 2The sale price is approximately $50 million in cash, subject to working capital and other adjustments.
  • 3The transaction is expected to close by the first quarter of 2020.
  • 4A pre-tax restructuring charge of $40 million to $50 million is expected in Q3 2019, largely due to non-cash impairment.
  • 5This divestiture is part of Arconic's strategy to divest non-core businesses.
  • 6The filing includes a standard disclaimer regarding forward-looking statements and associated risks.

Frequently Asked Questions

This 8-K filing announces Howmet Aerospace's (then Arconic Inc.) agreement to sell its aluminum rolling mill in Itapissuma, Brazil, as part of its strategy to divest non-core assets.

Arconic expects to recognize a pre-tax restructuring charge of approximately $40 million to $50 million in the third quarter of 2019, primarily due to the non-cash impairment of the net book value of the rolling mill. The sale itself is expected to generate approximately $50 million in cash, subject to adjustments.

The transaction is anticipated to close by the first quarter of 2020, contingent upon receiving regulatory approvals and satisfying customary closing conditions.

The sale is part of Arconic's stated strategy to divest non-core businesses. Therefore, it is not expected to negatively impact the company's core operations, but rather to streamline its portfolio.