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16. August 2007

Ex-Siemens exec to head Alcoa

The aluminum company appoints Klaus Kleinfeld as president and chief operating officer.

(source: Reuters)


Aluminum company Alcoa Inc., which recently failed to acquire Canadian rival Alcan Inc. , said Wednesday that Klaus Kleinfeld, former president and chief executive of Siemens AG , will take over as its president and chief operating officer.

The move appeared to set in place a succession plan that would put German-born Kleinfeld, 49, in line to succeed current Alcoa Chief Executive Officer Alain Belda, who turned 64 in June.

 

"Someone who has managed such a multinational company [as Siemens] will also be in a good position to manage another multinational, like Alcoa," said Heiko Feber, an analyst at private German bank Bankhaus Lampe in Duesseldorf.

"I think that he will address the upcoming issues consistently, that he will be decisive and won't hesitate," he added. "And that's something that's important in this industry, where there are a lot of mergers and acquisitions going on."

Company watchers have speculated that Belda, who is a Brazilian citizen, would retire next year, although Alcoa has not commented on the issue.

"The board does in fact contemplate that he [Kleinfeld] will be a key part of an orderly transition," Alcoa spokesman Kevin Lowery said.

Belda, chief executive officer since 1999, faced criticism after Alcoa failed in a $28.6 billion hostile bid to buy Alcan. There has also been speculation that Alcoa itself is a takeover target, although reports last month said BHP Billiton (down $1.74 to $55.93) was no longer considering a move for Alcoa.

Belda has also been targeted by some investors frustrated by Alcoa's near-flat stock performance in recent years.

Peter Schiff, CEO of Euro Pacific Capital, which holds some Alcoa stock, said "some investors might be upset." But he noted that in 2000, Alcoa stock was around $20 and was now around $35.

"That's about a 70-percent gain and better than the Dow Jones or S&P in that time."

Pittsburgh-based Alcoa's stock slipped on Wednesday's news, before recovering and holding down slightly around noon on the New York Stock Exchange.

According to Alcoa, Kleinfeld will have full responsibility for all operating activities of the company and will start the new job on Oct. 1. The position was created for Kleinfeld, who has been on Alcoa's board of directors since 2003.

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