Elliott Management, the activist hedge fund run by Paul Singer, has made some shocking claims about Arconic's newly departed CEO, who resigned Monday amid an ongoing effort by the activist fund to persuade the company to get a new chief.
In a surprise move, Klaus Kleinfeld stepped down as chair and CEO of Arconic and resigned from the company's board after the company said he displayed "poor judgment" in sending a letter directly to a senior officer of Elliott Management. The contents of the letter are still unknown.
Later in a release, the activist firm slammed Kleinfeld, saying "the letter read as a threat to intimidate or extort a senior officer of Elliott Management based on completely false insinuations, a threat that we took seriously and about which we immediately and privately informed the Board."
Arconic declined to comment to CNBC on the exact contents of the letter.
Kleinfeld had been singled out by Elliott, which criticized his leadership and proposed a plan to boost the metal parts maker's valuation.
Arconic shares initially surged by as much as 9 percent following the news of Kleinfeld's resignation. But they pared those gains and closed just 3 percent higher after traders realized that Kleinfeld's resignation did not necessarily mean the board is now going to go along with Elliott's plan.
Arconic said Kleinfeld's departure was not in response to the proxy fight Elliott launched or to the activist investor's criticisms of Arconic and lobbying for it to replace Kleinfeld.
The activist firm said it intends to continue its pursuit of "fundamental Board-level change as vigorously as ever."
Elliott said the problem ultimately lies with the board, which "repeatedly excused, endorsed, and participated in Dr. Kleinfeld's poor leadership and attempts to entrench himself and his allies on the Board."
Current board member David Hess has been appointed as the interim CEO, and Patricia Russo has been appointed the board's interim chair. Kleinfeld oversaw the split of
Now that Kleinfeld has stepped down,
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