Alcoa Updates on Portfolio Review

New York-(Business Wire)-Following the recent monetization of its stake in Aluminum Corporation of China Limited (Chalco), Alcoa (NYSE:AA) today announced a series of portfolio decisions that will further enhance its capital structure and provide additional opportunities to improve shareholder value.

After completing the strategic review of its portfolio, the Company intends to proceed with the sale of its Packaging and Consumer business. The company has received strong indications from strategic buyers for that business, and plans to complete the transaction by late 2007 or early 2008. The company is also near a definitive agreement to sell its Automotive Castings business and should close that transaction by the end of the year.

In addition, the company plans to significantly restructure its Electrical and Electronic Solutions (formerly the Alcoa Fujikura Limited wireharness business) business in the Americas and Europe to improve returns and profitability.

These portfolio actions will be carried out in consultation with the unions and works councils as required by applicable U.S., European and local rules and regulations

As a result Alcoa expects to record after-tax restructuring and impairment charges in the third quarter of 2007 of approximately $195 million related to the Electrical and Electronic Solutions business; approximately $50 million for charges related to the automotive castings business; and approximately $600 million related to the planned sale of the packaging and consumer business, the majority of which is associated with income taxes.

These portfolio actions, combined with the sale of Alcoa’s stake in Chalco, will significantly enhance the company’s capital structure and add flexibility for both growth opportunities and other initiatives to improve shareholder value.

The precise impact on the third quarter’s results of the restructuring and impairment charges, along with the gain on the sale of the Chalco shares, will be detailed in the company’s earnings release and conference calls next Tuesday, October 9, 2007.

Alcoa is the world’s leading producer and manager of primary aluminum, fabricated aluminum and alumina facilities, and is active in all major aspects of the industry. Alcoa serves the aerospace, automotive, packaging, building and construction, commercial transportation and industrial markets, bringing design, engineering, production and other capabilities of Alcoa’s businesses to customers. In addition to aluminum products and components including flat-rolled products, hard alloy extrusions, and forgings, Alcoa also markets Alcoa® wheels, fastening systems, precision and investment castings, structures and building systems. The company has 116,000 employees in 44 countries and has been named one of the top most sustainable corporations in the world at the World Economic Forum in Davos, Switzerland. More information can be found at www.alcoa.com.