Russia’s TMH Group, a supplier of rolling stock, has agreed to buy Norway-based Bergen Engines from Rolls-Royce for a net price of €150 million (US$180 million). The deal is one of a number of sales involving its smaller businesses in an attempt to mitigate the financial hardship the conglomerate is suffering as a result of the COVID-hit aerospace industry.
Rolls-Royce relies heavily on revenue from airlines which is generated on a flying-hours basis and has already warned that it may well suffer from continued cash outflows though 2021 as air travel looks to remain constrained. The company hopes to raise approximately £2 billion (US$4.74 billion) and a major portion of that amount will come from the sale of Spain-based IAP Aero.
“The sale of Bergen Engines is a part of our ongoing portfolio evaluation to create a simpler, more focused group and contributes towards our target to generate at least £2 billion from disposals,” said Rolls-Royce’s CEO Warren East.
Bergen makes medium-speed gas and diesel engines for marine and power generation clients, employing approximately 950 people, and generated roughly £239 million (US$327.00) in 2019.
