Alcoa: Portovesme Smelter Fate Undecided; Still Set For Closure

Date : 03/09/2012 @ 10:43AM
Source : Dow Jones News
Stock : Arconic Inc. (ARNC)
Quote : 25.21  0.46 (1.86%) @ 4:10PM

Alcoa: Portovesme Smelter Fate Undecided; Still Set For Closure

Alcoa (NYSE:AA)
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A decision on the future of the Portovesme aluminum smelter in Sardinia, Italy, is still undecided following a meeting held Thursday between unions, management and government officials, its owner Alcoa Inc. (AA) said Friday.

Various measures are being considered for the future of the 150,000 metric-tons-a-year smelter, which is slated for closure in the first half of this year as part of Alcoa's plan to curtail high-cost capacity, amid an uncompetitive energy position, rising raw material costs and falling aluminum prices.

Alcoa said Italy's Ministry of Economic Development convened a meeting attended by the company plus representatives of the government, unions and the Works Council of the plant.

"The meeting was an opportunity to further discuss possible solutions for our employees and the local community but has not yet led to a definitive agreement," Alcoa said. "Alcoa reconfirms its readiness for further consultation with all stakeholders, in the framework of the mobilita process which started in January, in order to find the best possible solutions for our employees and the community."

The ‬mobilita process is a collective dismissal procedure and ends April 4. Labor unions strongly oppose the closure of the plant.

A sale of the smelter is a possibility.

The smelter is located close to the Eurallumina refinery, also in Portovesme. The 1.085 million-tons-a-year alumina refinery is majority-owned by United Co. Rusal PLC (0486.HK) following a deal buying out U.K.-listed Rio Tinto PLC's (RIO) majority stake in 2006. U.K.-listed Glencore International PLC (GLEN.LN) at that time held the remaining stake, which were part of the alumina assets it folded into a merger with Rusal and SUAL.

In January, Italy's industry ministry said Glencore had expressed interest in the smelter, which is located near to one of its lead and zinc plants.

-By Andrea Hotter, Dow Jones Newswires; +44 (0)20 7842 9413; andrea.hotter@dowjones.com

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