| Rolls-Royce and Goodrich announce engine controls joint venture |
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22/12/2008 04:59 (1147 Day 09:19 minutes ago) | |||||
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The FINANCIAL -- Further to the announcement on 14 August 2008 regarding the proposed formation of an engine controls joint venture, Rolls-Royce on December 22 announced agreement with Goodrich Corporation to form Rolls-Royce Goodrich Engine Control Systems Limited, trading as Aero Engine Controls.
Aero Engine Controls will develop and supply engine controls for Rolls-Royce engines. The transaction is expected to be complete within two weeks.
Aero Engine Controls, a 50:50 joint venture, will combine Goodrich's existing UK-based engine controls design and manufacturing business with Rolls-Royce's Full Authority Digital Engine Control (FADEC) engineering expertise. Goodrich will retain the aftermarket products and services business associated with the joint venture's products.
In establishing the joint venture both parties will have transferred approximately £14m of assets and cash into Aero Engine Controls. In addition Rolls-Royce will make a cash payment of $100m to Goodrich Corporation and will assume certain foreign exchange contracts with an estimated cost to Rolls-Royce of £20m. Assets being transferred from Rolls-Royce to the joint venture are expected to have minimal impact on Rolls-Royce Group profitability estimates.
Aero Engine Controls will have around 1,330 employees, comprising staff who will transfer from the two companies, and has sites in Derby, Birmingham and Belfast.
Colin Smith, Director-Engineering & Technology, Rolls-Royce plc said, "We are pleased with the progress made since August to form Aero Engine Controls. Forming this new company provides an exciting opportunity to combine the skills, knowledge and expertise of both companies into a single team with common goals.It also enables us to share our joint capability and work more efficiently to meet the demands of an increasingly important market."
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