Alcoa Chairman and CEO Klaus Kleinfeld (right) and VSMPO Chairman Sergei Chemezov (left), signed a cooperation agreement at a ceremony in Moscow, marking the first step in forming a new joint venture company to meet growing demand for high-end titanium and aluminum products for aircraft manufacturers worldwide. Photo courtesy of the press service of Rostec Corporation.
Alcoa (NYSE:AA), the leading supplier of aluminum solutions to the world's aerospace industry, and Russia’s VSMPO-AVISMA Corporation, the world′s largest manufacturer of titanium ingots and forged products, have agreed to join forces to meet growing demand for high-end titanium and aluminum products for aircraft manufacturers worldwide.
Alcoa Chairman and CEO Klaus Kleinfeld and VSMPO-AVISMA Chairman Sergei Chemezov signed a cooperation agreement at a ceremony in Moscow, marking the first step in forming a new joint venture. Once formed, the joint venture will combine Alcoa’s expertise in manufacturing value-add products with VSMPO-AVISMA’s global leadership in titanium production to manufacture high-end aerospace goods, such as landing gear and forged wing components, at Alcoa’s plant in Samara.
"The agreement marks an important step in leveraging Alcoa’s and VSMPO-AVISMA’s strengths in innovation and manufacturing to capture opportunities in the high-growth aerospace market," said Alcoa Chairman and CEO Klaus Kleinfeld. "This alliance will enhance Alcoa’s competitiveness and position our global aerospace business for continued profitable growth.”
"We actively collaborate with global industrial leaders to implement large-scale projects. Our partnership with Alcoa will help increase our productivity, expand our offerings to customers, and help VSMPO-AVISMA move forward on our strategy to increase the share of our value-add products,” said Sergei Chemezov, Chairman of the Board of Directors, PSC VSMPO-AVISMA and Head of Rostec Corporation.
Mikhail Voevodin, General Director, PSC VSMPO-AVISMA Corporation, said, “This agreement will add to our current manufacturing capabilities, as the company gets access to unique forging equipment. This step enables us to increase our output and ensure the consistency of supply, allowing us to meet growing demand for our products from leading global aircraft manufacturers.”
"This manufacturing partnership will expand on our mutual and complementary strengths in making the largest and most advanced aerospace forgings in the world,” said Eric Roegner, Chief Operating Officer of Alcoa Investment Castings, Forgings and Extrusions.
The joint venture, which is expected to be operational in 2016, will capture opportunities in the global aerospace market. Based on Alcoa’s estimates as of October 8, 2013, the aerospace market is expected to grow by 9-10 percent in 2013.
Additional terms of the transaction were not disclosed.
About Alcoa
Alcoa is the world’s leading producer of primary and fabricated aluminum, as well as the world’s largest miner of bauxite and refiner of alumina. In addition to inventing the modern-day aluminum industry, Alcoa innovation has been behind major milestones in the aerospace, automotive, packaging, building and construction, commercial transportation, consumer electronics and industrial markets over the past 125 years. Among the solutions Alcoa markets are flat-rolled products, hard alloy extrusions, and forgings, as well as Alcoa® wheels, fastening systems, precision and investment castings, and building systems in addition to its expertise in other light metals such as titanium and nickel-based super alloys. Sustainability is an integral part of Alcoa’s operating practices and the product design and engineering it provides to customers. Alcoa has been a member of the Dow Jones Sustainability Index for 12 consecutive years and approximately 75 percent of all of the aluminum ever produced since 1888 is still in active use today. Alcoa employs approximately 60,000 people in 30 countries across the world.
About VSMPO-AVISMA Corporation
PSC VSMPO-AVISMA Corporation is the largest worldwide titanium producer, providing the full production cycle: from stock processing to production of finished parts of added value. Number of employees is approximately 20,000. The control stock of shares (50%+1) of VSMPO-AVISMA belongs to the management, the blocking shareholding (25%+1) belongs to Rostec Corporation.
