Rolls-Royce (RR.L) announced on Monday it signed an agreement to sell its civil nuclear instrumentation and control (I&C) business to French nuclear reactor business Framatome for an undisclosed amount, as the plane engine-maker looks to raise over £2bn ($2.7bn) from disposals.
The firm is battling to survive the crisis facing the global aviation industry as a result of the coronavirus pandemic. Demand for its parts and servicing has plummeted amid an unprecedented collapse in air travel.
CEO Warren East said the deal “marks a further simplification of our business and contributes towards our target to generate over £2bn from disposals, as announced on 27 August 2020. We also believe it represents the best outcome for this part of our civil nuclear operations and its people.”
The I&C business includes all the Rolls-Royce activities and teams based in France, the Czech Republic and China.
In 2019, the unit had 550 employees and reported revenues of €94m ($114m, £86m), which the company said were consolidated within the results of its power systems business.
Framatome said the deal will help add to its engineering expertise, and expand its global capabilities in I&C systems. It explained that these systems serve as part of the “central nervous system” of a nuclear power plant and allow operators to control the reactor.
Rolls-Royce said no UK-based employees will be impacted as part of the agreement and the sale does not include the UK civil nuclear business, or small modular reactor activities.
The transaction is expected to be completed mid-2021, subject to closing conditions.
Last week, Rolls-Royce announced details of plans to reduce its manufacturing capacity following a “significant” fall in global demand from commercial aviation companies.
And last month it sold 94% of new shares in a £2bn rights issue. The company is seeking to raise a total of £5bn to shore up its finances.
Earlier, it confirmed it was looking to cut 950 jobs within its civil aerospace arm worldwide, and another 420 across its facilities teams.
The leading manufacturer of plane parts had announced in May it would axe 9,000 roles worldwide, including 3,000 roles in the UK. The cuts announced last month fall within that tally as the company seeks to drastically rein in costs. More than 2,500 staff have already taken voluntary severance since the crisis began.
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