BRK.A Berkshire Hathaway Inc

LONDON—Alcoa Inc. on Thursday said it signed two contracts valued at more than $2.5 billion to supply airplane maker Boeing Co. with parts for next-generation airliners.

One contract is for New York-based Alcoa to provide aerospace fasteners to Boeing, the world's biggest plane maker, in the largest deal ever of its type, Chief Executive Klaus Kleinfeld said. The fasteners, used to hold together plane parts, would be made from a range of materials, including aluminum, advanced titanium, and nickel-based superalloys.

Boeing is introducing new models of its 737 single-aisle plane and 777 long-range jets and has been renegotiating supplier contracts as part of the process. "We are pretty much, with our fasteners, on every Boeing platform and this contract secures that also going forward onto their new and revamped platforms," Alcoa's Mr. Kleinfeld said in an interview.

Alcoa signed a similar deal in October to supply Airbus Group SE, the world's No. 2 plane maker, with $1 billion worth of bolts, rivets and other plane parts.

Additionally, Alcoa said Thursday it secured a contract to be the sole supplier of titanium seat track assemblies for Boeing's 787-10, the latest model of the Chicago-based planemaker's Dreamliner. Alcoa already provides the component, which are used to secure passenger seats to a plane's floor, for existing versions Dreamliner models.

The two contracts come after Alcoa said in September that it would split its mining, processing and smelting divisions and the higher-margin activities that make parts and pieces for airplanes and cars.

The split remains on track to be completed in the second half of next year, Mr. Kleinfeld said, calling the separation "a lot of work." The company has set up a dedicated team to manage the separation to avoid distractions to the existing businesses, he said.

Mr. Kleinfeld, who will lead the higher-margin activities, built up Alcoa's aerospace portfolio through a series of acquisitions. It bought U.K. jet-engine-parts maker Firth Rixson Ltd. in 2014, and this year acquired Pittsburgh-based RTI International Metals Inc., one of the world's biggest makers of fabricated titanium products for the aerospace industry.

The deal with Boeing for Dreamliner seat-tracks builds was won thanks to the RTI purchase, Mr. Kleinfeld said.

Alcoa's spinoff will compete with Precision Castparts Corp. of Portland, Ore. Warren Buffett's Berkshire Hathaway Inc. bought Precision Castparts in August for $37.2 billion, including debt, in Mr. Buffett's biggest acquisition yet.

Mr. Kleinfeld wouldn't directly address the prospect for further acquisitions while it works on the split, though he said "we do not lose sight of catering to our customers at any minute during separation or after separation."

After Alcoa announced plans to split, hedge fund Elliott Management Corp. said it had become one of the company's largest shareholders. Mr. Kleinfeld said all the discussions with the investor have been "extremely constructive." He added that Alcoa isn't expecting Elliott, the New York hedge fund founded by Paul Singer, to seek a board representation.

Write to Robert Wall at robert.wall@wsj.com

(END) Dow Jones Newswires

December 17, 2015 10:25 ET (15:25 GMT)

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