Published: Tue, April 18, 2017
Money | By Oscar Reynolds

Klaus Kleinfeld Out as Chairman and CEO of Arconic

Klaus Kleinfeld Out as Chairman and CEO of Arconic

The maker of aerospace and automotive parts said Kleinfeld stepped down after the board learned that he had sent a letter to a senior officer of Elliott Management without consultation with the board.

Arconic said Kleinfeld's resigned as he sent the letter - the content of which neither party made public - without consulting the board, and not in response to the proxy fight or Elliott' criticisms of the company's strategy, leadership or performance.

The development could alter the course of a proxy fight launched by Elliott in January, when the hedge fund nominated five directors to the company's board and outlined ways for Arconic to improve its share price.

The Arconic Davenport Works location in Riverdale is one of the largest employers in the Quad Cities.

On its website, Arconic defended Kleinfeld, noting he presided a year ago over the change that divided Alcoa, the aluminum producer based in NY, from Arconic, the product manufacturer that makes aluminum, titanium and nickel parts for planes, cars and electronics. The New York-based company was spun off from aluminum company Alcoa previous year.

The company said Mr. Kleinfeld's decision to step down had nothing to do with the proxy fight being waged by Elliott, a New York-based hedge fund. Arconic's statement praised Mr. Kleinfeld for his "transformative vision" and said he improved the company's performance despite a hard environment.

Arconic's stock jumped as much as 9.8 percent on Monday, before easing to trade up 2.5 percent at $26.56 in late afternoon trading.

Up to Thursday's close, Arconic had risen 36.9 percent since the spilt on November 1.

Board member David Hess will serve as interim CEO as the company looks for a permanent replacement. Lawson is also Elliott's consultant.

Elliott has said that Lawson should be a leading candidate for the top job at Arconic.

Like this: