Alcoa (NYSE:AA) will soon be one asset lighter in Europe. The company announced that it is to shutter its Fusina smelter in Italy. This is not a sudden move; activity at the facility was curtailed in June 2010.
It is also not a surprise, given the persistent struggles of the aluminum industry over the past several years. In the press release announcing the closure, the firm quoted Bob Wilt, president of its global primary products division, as saying that "Global aluminum prices remain weak and we must take action to maintain Alcoa's competitiveness."
The shuttering will mean a reduction, although not a large one, in the company's global smelting capacity. The current level of roughly 4.2 million metric tons per year will drop by 44,000.
Alcoa said total after-tax charges related to the closure will total $30 million-$35 million, or around $0.03 per share. Roughly 50% of those charges are expected to be non-cash. The charges will be accounted for in the company's Q2 financials.
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