Rolls-Royce has put the bulk of its loss-making marine business up for sale as part of a cost-cutting drive that will see the firm trimmed down.
The marine division has been hammered by the slump in the oil price over recent years and Rolls’ boss Warren East said the time had come to consider whether it would do better under different owners.
It is thought the commercial division under review could be worth between £500m and £800m. GE, Wartsila and Siemens are being suggested as possible buyers.
New direction: Rolls’ boss Warren East said the time had come to consider whether it would do better under different owners
The possible sale is part of a revamp announced yesterday that will see the Derby-based engineering giant cutting itself down into three divisions: civil aerospace, defence and power.
Rolls would not put a figure on how many jobs might go under the reorganisation, but said it would honour existing agreements with workers. Some corporate jobs are expected to go.
East said: ‘It will create a defence operation with greater scale in the market, enabling us to offer our customers a more integrated range of products and services.
‘It will also strengthen our ability to innovate in core technologies and enable us to take advantage of future opportunities in areas such as electrification and digitalisation.’
Nearly 2,000 jobs have already been lost at the marine division as it plunged to losses of £2.7m on sales of £1.1bn in 2016.
The bulk of this business supplies equipment and vessel design across the oil and gas, merchant and other commercial markets.
Rolls is reviewing this commercial division but plans to keep hold of the marine operations which supply complex power and propulsion operations to naval customers, including the Royal Navy.
The wider overhaul will see the firm’s nuclear submarine systems moving into defence, and civil nuclear activities moving into power.
COBHAM ON DEFENSIVE
A scandalwhich saw helicopter pilots at defence firm Cobham buy fake degrees had no impact on safety, bosses have said.
Seven British nationals at Cobham-owned contractor FB Heliservices bought the documents between 2013 and 2015 – including two pilots.
And a three-month probe, completed last June, said the issue was related to a handful of staff based at Curacao in the Caribbean.
Chief executive David Lockwood said the employees had the required qualifications and the ability to do the jobs, and that there was no impact on safety.