Alcoa (AA) Joint Venture Settles Bahraini Bribery Case

NEW YORK (TheStreet) -- Alcoa (AA) announced Thursday that joint venture Alcoa World Alumina agreed to pay a $384 million to settle bribery allegations.

Shares of Alcoa fell 2.1% to $10.60 on Thursday.

The joint venture was accused by the U.S. Justice Department and the Securities and Exchange Commission of bribing and providing kickbacks to members of the Bahraini royal family to maintain a supply agreement with a state company. The Justice Department said the payments were sent through various middlemen and shell companies.

Alcoa World Alumina will pay a total of $223 million in installments over the next four years. Australian mining company Alumina (AWC) will pay 15% of the total fine.

While the joint venture will plead guilty to one count of violating the Foreign Corrupt Practices Act, there are no allegations against Alcoa itself.

News of the settlement comes hours before Alcoa will announce its quarterly earnings on Thursday.

TheStreet Ratings team rates ALCOA INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about its recommendation:

"We rate ALCOA INC (AA) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, impressive record of earnings per share growth and notable return on equity. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow, poor profit margins and generally higher debt management risk."

If you liked this article you might like

Feeling a Little Delphic on the Direction of Alcoa

How to Profit With Technical Analysis: Cramer's 'Mad Money' Recap (Fri 8/25/17)

Cramer: This Rally Isn't Without Meaning

Cramer: The Market Feels More Treacherous Than It Looks

Alcoa Still Unable to Hit New Highs on the First Try