Rolls-Royce has agreed a 63 million euro (£54 million) deal to sell its Norwegian maritime engine-making arm Bergen to British group Langley Holdings.
Rolls said the Langley deal is another step towards its target to make at least £2 billion from asset sales as boss Warren East looks to rebuild the group’s balance sheet.
It comes after an earlier deal with Russian group TMH Group was blocked by the Norwegian government in March.
Chief executive Mr East said: “The sale of Bergen Engines is a part of our ongoing portfolio management to create a simpler, more focused group and contributes towards our target to generate at least £2 billion from disposals, as announced last year.”
Rolls, which is due to report its half-year figures on Thursday, is hoping to complete the sale on December 31, having already notified the Norwegian government.
Shares in Rolls lifted 2% after the deal was announced.
Bergen employs more than 900 people globally and made around 200 million euro (£170 million) in revenues last year.
Langley, which is headquartered in the UK, employs around 4,600 people with main operations in Germany, Italy, France and Britain, alongside a substantial presence in the US.
It plans to run Bergen as a standalone business.
Chairman and chief executive Anthony Langley, who founded Langley in 1975, 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.”
Langley’s activities range from the production of uninterruptible power systems, packaging machinery and electric motors and generators, to the manufacture of safety-critical mechanical handling equipment, including for the Ministry of Defence’s submarine missile loading facility at Coulport in Scotland.
Mr East has been overhauling Rolls to strengthen its battered balance sheet, selling off assets and raising more than £5 billion from issuing new debt and equity.
He has also embarked on a swingeing cost-cutting programme that will lead to 9,000 jobs being cut worldwide.
Rolls crashed to a £4 billion loss in 2020, having been hit hard by the pandemic as the crisis hammered the global aviation industry.
Its half-year results are expected to show further pressure on the bottom line, but it will be watched for any signs that the worst of the pandemic impact has passed.