23rd Mar 2021 12:27
(Alliance News) - Rolls-Royce Holdings PLC on Tuesday said it aims to "swiftly find another option" after the Norwegian government put the brakes on the proposed sale of the jet engine maker's Bergen Engines unit.
The Norwegian government blocked the sale on national security concerns. Norway's army is among Bergen's customers. Rolls-Royce announced in early February that it would sell Bergen for EUR150 million to TMH Group, a privately owned company headquartered in Russia that makes locomotives and rail equipment.
Rolls-Royce said on Tuesday: "We note the announcement by the Norwegian government that the sale of Bergen Engines to TMH Group must be stopped. We followed the appropriate process in contacting the authorities in advance of the announcement of the sale on 4 February 2021.
"We have co-operated with the government's subsequent review by pausing the sales process and believed we had identified a new owner willing to invest in the business and its people for the long-term. We await formal legal notification by the Norwegian government."
Rolls-Royce affirmed that it does not plan on keeping the business and still eyes a total of GBP2 billion in disposals by early 2022.
"We will be seeking the assistance of the Norwegian government to swiftly find another option, which can provide Bergen Engines and its people with the investment required for the future and Rolls-Royce with an appropriate outcome," the company added.
Norway's government earlier in March said the country's national security arm informed Rolls-Royce it was "considering if the planned sale of Bergen Engines to TMH group should be stopped in accordance with the security act".
"The government has been studying this matter for the last months, and it can't be eliminated that the sale of Bergen engines to TMH Group can risk national security interests," Justice Minister Monica Maeland said in a statement at the time.
Bergen Engines, which employs 950 people, has been part of Rolls-Royce since 1999, servicing engines for Norwegian Navy vessels.
Rolls-Royce shares were 3.8% lower at 107.55 pence each in London on Tuesday afternoon.
By Eric Cunha; [email protected]
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