Arconic CEO Klaus Kleinfeld steps down

The CEO of Arconic has stepped down after an ugly battle with hedge fund titan Paul Singer

Arconic stock rose 4.3% to 27.01 in late morning action, back below its 50-day line after hitting 28.44 intraday.

Arconic said Mr. Kleinfeld's exit comes after he sent an unauthorized letter to Elliott that "showed poor judgment" without consulting Arconic's board.

Klaus Kleinfeld has been pushed out as chairman and chief executive officer of Arconic Inc., an abrupt departure following heavy pressure from activist investor Elliott Management Corp.

Elliott Management launched a proxy fight against the company in January, nominating five directors to serve on the company's board and outlining ways for Arconic to improve its share price.

Arconic Inc. makes aluminum, titanium or nickel parts for planes, cars and electronics.

Elliott had been campaigning for the ouster of Kleinfeld and had engaged Larry Lawson, formerly CEO of aircraft parts supplier Spirit AeroSystems Holdings Inc, as a consultant.

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.

- David Hess, a former senior executive at United Technologies who joined the board in March, was appointed interim CEO. Patricia Russo, the company's lead director and chair of Hewlett Packard Enterprise Co., was named interim chair.

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

Related:

Comments


Other news