Roll-Royce is selling its medium speed liquid fuel and gas engines business to UK-based defence contractor Langley Holdings for an enterprise value of around US$75M after a ’strategic review’
UK-headquartered Rolls-Royce said the move was part of an effort to bank some US$2.8Bn from so-called "disposals".
"The agreed sale of Bergen Engines is a part of our ongoing portfolio management to create a more focused group and follows a strategic review of Bergen Engines. It contributes towards our target to generate at least £2bn from disposals, as announced last year," a Rolls-Royce statement said.
The company said proceeds of US$83M from the sale will be combined with US$34M of cash currently held within Bergen Engines and retained by Rolls-Royce to rebuild its balance sheet and help the company regain an investment-grade credit profile.
Global engineering group Langley Holdings is funding the purchase and working capital requirements for the Bergen Engines business from existing cash reserves.
The sale includes the Bergen Engines factory, service workshop and foundry in Norway, the company’s engine and power plant design capability and its service network with operations in several countries. Bergen Engines employs more than 900 people worldwide including 650 in its Hordvikneset, Norway factory. In 2020, Bergen Engines’ business generated revenues of approximately US$237M with its assets and liabilitieslisted as ’held for sale’ in Rolls-Royce’s balance sheet.
Langley Holdings is a family-owned and UK-headquartered company that has operations in Germany, Italy, France and the US in addition to the UK. The group employs around 4,600 people and produces uninterruptible power systems, packaging machinery and electric motors and generators along with safety-critical mechanical handling equipment.
Langley Holdings CEO Anthony Langley said: "The acquisition of Bergen Engines is a strategic step in the development of our power solutions division, and I am looking forward to welcoming the 900 plus employees of Bergen Engines to our family of businesses."
Bergen Engines Managing Director Jon Erik Røv said he was "confident that Bergen Engines will prosper with Langley Holdings as our new owners".
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