February 8, 2019 / 1:50 PM / 5 months ago

UPDATE 1-Arconic plans to split its two core businesses

(Adds background about the two businesses, shares)

Feb 8 (Reuters) - Arconic Inc would split itself into two units - aircraft and power generation components unit and sheet and plate products division, and will spin off one of them at a later date, the U.S. aluminum products maker said on Friday.

The decision comes days after Chairman John Plant took over as chief executive officer in a surprise move, following Arconic's rejection of a takeover bid by private equity firm Apollo Global Management last month.

The company's biggest shareholder Elliott Management Corp has been trying to push Arconic for a sale, but potential legal liabilities from its smaller building and construction systems unit has put a question mark on the company's valuation, causing the board to be split over possible offers.

"After a rigorous and comprehensive process...the board sees more shareholder value creation through a restructuring of the company," Plant said in a statement, as Arconic reported better-than-expected fourth-quarter profit.

The company's shares rose 2.6 percent to $18.15 in early trading. (Reporting by Ankit Ajmera in Bengaluru; Editing by James Emmanuel and Arun Koyyur)

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