The global power systems company Rolls-Royce has announced that it will acquire the 50 per cent of shares it does not already own in Aero Engine Controls (AEC), a joint venture with Goodrich Corporation.
AEC was established in January 2009 to combine the engine controls businesses of the two companies. It was set up as a break-even business – its profit before tax was £0.2m at 31 December 2011.
The joint venture principally designs and manufactures engine control systems including fuel pumps and fuel metering units for a wide range of Rolls-Royce engines and for a number of other programmes. Engine control systems are playing an increasingly important part in enhancing the fuel efficiency and overall performance of modern jet engines.
The transaction, which will have no material impact for Rolls-Royce on the current year’s financial performance, has been agreed with United Technologies (UTC), which is in the process of acquiring Goodrich. The acquisition of the remainder of the shares in AEC by Rolls-Royce will only proceed once the acquisition of Goodrich by UTC is complete and once any necessary antitrust approvals are obtained.
Its cost will be a cash amount determined by 50 per cent of the audited net asset value of AEC once the acquisition of Goodrich by UTC is complete. At the end of 2011, AEC had gross assets of £116m and net assets of £8m.
Rolls-Royce employs more than 40,000 people in offices, manufacturing and service facilities in over 50 countries.
AEC employs around 1,400 people and has sites in Birmingham, Derby, and Belfast in the UK and in Indianapolis, US.