JSC “United Shipbuilding Corporation” and Alcoa Inc. Sign Memorandum of Understanding

Monday, Jun 21, 2010

Alcoa (NYSE:AA) Chairman and CEO Klaus Kleinfeld and United Shipbuilding Corporation President Roman Trotsenko, today signed a Memorandum of Understanding between the companies aimed at helping to develop the Russian ship building market and increasing the use of aluminum in Russian ship building. The signing took place at the St. Petersburg International Economic Forum.

During preliminary consultations the parties defined potential areas for cooperation including the technical and commercial aspects of growing the Russian market. Aluminum has been used in marine applications since the 1890’s and has proven itself as a lightweight, durable and affordable material that allows ships to go faster, carry bigger payloads and travel longer ranges.

Commenting on the signing, Klaus Kleinfeld said: “We are very glad to start full scale cooperation with the USC, the corporation uniting practically all the main Russian assets in shipbuilding at present, which jointly account for more than 65 percent of the products manufactured in the Russian ship building sector.

“New technologies and advancements are making aluminum an increasingly popular choice for ships of all sizes throughout the world,” Kleinfeld said. “I’m absolutely convinced that the potential for the usage of aluminum is very high in the shipbuilding industry, and especially in Russian shipbuilding.”

Roman Trotsenko, President of USC, said: “We appreciate the interest of such a major partner as Alcoa to the Russian shipbuilding industry modernization projects. We hope that our joint efforts will bring real results in a fairly short term.”

Alcoa has been present in Russia since 1993. In 2005, the company purchased two leading aluminum fabricating facilities Alcoa SMZ (formerly the Samara metallurgical plant) and Alcoa Metallurg Rus (formerly Belaya Kalitva metallurgical production plant.). Alcoa has modernized the facilities, investing more than $750 million in upgrades. The capabilities of the plants are now state of the art and are serving a variety of markets in Russia and beyond. The company recently completed a new end and tab line to complement its can sheet capabilities in Russia to serve the growing packaging market there. About 5500 people work at Alcoa Russia.

JSC “United Shipbuilding Corporation” is the biggest holder of shipbuilding, ship repairing and engineering assets in the Russian industry. Russian state is a 100 per cent shareholder of the corporation.

Source: Alcoa