Rolls-Royce To Sell Its Energy Assets To Siemens - Quick Facts

(RTTNews) - Rolls-Royce Holdings plc (RR.L, RYCEY.PK) has agreed to sell its Energy gas turbine and compressor business to German engineering giant Siemens AG (SI) for 785 million pounds cash. The business being sold supplies aero-derivative gas turbines, compressor systems and related services to customers in the Oil and Gas and Power Generation sectors.

Following the transaction closure, Rolls-Royce would receive a further 200 million pounds for a 25-year licensing deal, granting Siemens access to relevant Rolls-Royce aero-derivative technology for use in the 4 to 85 megawatt power output gas turbine range.

This transaction excludes some smaller Power Generation sector assets. Upon completion, Rolls-Royce's stake in the Rolls Wood Group or RWG joint venture, that provides maintenance, repair and overhaul services, would be transferred to Siemens.

With nearly 2,400 employees, Rolls-Royce's Energy gas turbine and compressor business was reported within the results of the Energy business in 2013, where it contributed 871 million pounds of revenue and 72 million pounds of underlying profit. Siemens' Energy sector has around 83,500 employees and in 2013 contributed revenue of 26.6 billion euros and underlying profit of 1.9 billion euros.

The transaction was approved by both the companies' boards, and is likely to close before the end of December 2014.