Rolls-Royce to buy remaining stake in Spanish firm ITP for €720m
Engineering group Rolls-Royce said today that it has agreed to buy the outstanding 53.1 per cent shareholding in Industria de Turbo Propulsores (ITP) owned by Sener Grupo de Ingeniería.
The FTSE 100-listed firm will pay €720m (£614m) for the stake, after Sener exercised a put option. Under the existing shareholder agreement, the payment will be settled over a two year period following completion in eight equal, evenly spaced instalments. The agreement allows flexibility to settle up to 50 per cent of the consideration in shares.
ITP designs and manufactures aero engine components, and has partnered with Rolls-Royce on all its Trent programmes. The firm is headquartered in Bilbao, Spain, and employs over 3,000 people in facilities in Spain, Mexico, India, Malta, US and the UK.
Rolls-Royce said the acquisition strengthens its position on civil aerospace large engine growth programmes "by capturing significant additional value from its long-term aftermarket revenues", and said it also enhances the group's manufacturing and services capabilities and adds value to the defence aerospace business.
"ITP has been a trusted partner for Rolls-Royce over many years as well as working for other engine manufacturers," said Rolls-Royce chief executive Warren East.
"This investment will add to our aerospace capability, with excellent facilities, services and products, to generate additional opportunities for profitable growth. We look forward to forging a closer and more productive future together, and to welcoming ITP's employees into Rolls-Royce. I would like to thank Sener for their close relationship over three decades as we have built this exceptional business."
Ignacio Mataix, ITP's chief exec, added: "I am delighted that we are joining the Rolls-Royce family. We have already worked together to create outstanding aerospace products and services which will generate long term value. The acquisition will create new growth opportunities, while maintaining our current portfolio and strengthening our global position. I am sure it will provide significant opportunities for our employees across the business."
Rolls-Royce has endured a turbulent year so far – in May the company's credit rating was cut, and the firm has also made a series of cuts in its senior management team in 2016.