Tag Archives: Rolls-Royce

Nuclear Sub Protection Plan For Rolls-Royce

Nuclear Sub Protection Plan For Rolls-Royce

The financial woes at Rolls-Royce could result in the nationalisation of its nuclear submarine division, under contingency plans.

13:49, UK,Monday 14 December 2015

HMS Vengeance

HMS Vengeance is part of UK’s Trident fleet – powered by Rolls-Royce

Plans to protect the UK’s interests if the company powering the country’s nuclear deterrent runs into deeper trouble have been reportedly drawn up by the Government.

Rolls-Royce’s nuclear submarine business – which maintains the nuclear reactor propulsion systems aboard the Navy’s four Trident-fitted submarines – could even be nationalised under the contingency plans, according to the Financial Times.

It said several options had been drawn up to cover various scenarios, including the possibility of a takeover bid for the group by a foreign firm.

While there are existing safeguards to ensure the Government must approve any such deal, investors would perhaps be forgiven for considering any interest, given the fact the Rolls-Royce share price has lost a third of its value this year alone.

The company has issued a string of profit warnings – its problems exacerbated by weaker defence spending and lower demand for its services in the oil and gas industry following the collapse in commodity prices.

The company outlined the initial phase of its turnaround strategy under new chief executive, Warren East, a fortnight ago.

It involved hundreds of senior managers losing their jobs and hundreds of millions of pounds being slashed from the company’s annual cost base.

Its biggest shareholder, the American activist fund, ValueAct, has attracted particular attention.

It is pressing Rolls to go further and sell off its marine engine division – a move Mr East has signalled he is reluctant to do.

ValueAct is also seeking a place on the board.

Sky News reported last week that Value Act’s stake in Rolls-Royce – which remains one of the Government’s most important suppliers and engineering contractors – was said to have attracted increasing attention from senior Whitehall officials.

Representatives of both firms were expected to meet in Derby this week.

A Rolls-Royce spokesperson said on Monday: “We are in contact with Government as a matter of routine and regularly keep them updated on our performance and progress.”

The defence procurement minister Philip Dunne told the FT last week the Government was “concerned” Rolls-Royce was able to maintain its nuclear obligations and would “take a view in the event there was corporate activity.”

A spokesman for the Prime Minister said today: “Rolls-Royce is a major contributor to our economy. It’s an important supplier to the government. We will continue to work closely with them. I’m not going to get into specifics about the company’s future.”

Link – Sky News story
Advertisements

Rolls-Royce begins work on new Raynesway factory to build reactors for submarines

WORK has officially started on Rolls-Royce’s new submarine reactor factory.

Yesterday, Vice Admiral Sir Andrew Mathews, the Royal Navy’s chief of fleet, conducted a ground-breaking ceremony at the company’s marine power site in Raynesway.

4582863

 

The multi-million-pound Core Manufacturing Facility will replace existing production buildings at the site. It will produce reactor fuel cores for UK submarines and will support 300 Derby jobs.

Vice Admiral Sir Andrew Mathews leads the ground-breaking ceremony at the site of the new Rolls-Royce factory that will build reactors for the UK sub fleet.

Vice Admiral Sir Andrew Mathews leads the ground-breaking ceremony at the site of the new Rolls-Royce factory that will build reactors for the UK sub fleet.

The building is part of a phased revamp of the Raynesway site, which will take place over the next decade.

Sir Andrew said: “Rolls-Royce has played a vital role in supporting the Royal Navy’s nuclear submarine propulsion programme for over 50 years.

“This significant investment to regenerate the facility, to build our nuclear reactor cores, will ensure that the site continues to do so for decades to come.”

Jason Smith, president of submarines and chief operating officer for nuclear, said: “We are pleased to begin construction of this important facility, which will use the most advanced manufacturing techniques to enhance our world-leading nuclear manufacturing capability.

“The investment in this facility demonstrates the high level of trust that the Ministry of Defence has in both our technology and the expertise of our highly skilled workforce.”

Rolls-Royce is investing £500 million to regenerate its Raynesway site after striking a huge £1.1 billion deal last year to build submarine reactors for the MoD.

A further £600 million is being used to develop two submarine reactors.

One of the engines will be used to power a seventh Astute Class attack submarine and one will be for the first of the next generation of nuclear-deterrent submarines – the Vanguard, which can deploy Trident ballistic missiles carrying nuclear warheads.

They will replace the four existing Vanguards, the first of which is due to leave service in 2022.

The Government has said that a final decision on renewing the Trident missile system would not be made until 2016 – but long lead times meant that work on the project needs to start now.

Last week, Rolls-Royce signed a 10-year “foundation contract” with the MoD, worth £800 million.

It is aimed at delivering and supporting the UK’s nuclear submarine fleet.

The contract covers the overheads, running and business costs at Rolls-Royce’s submarines sites.

Source – This is Derbyshire

 

UK – Rolls-Royce secures £800m MoD contract

Engineering giant Rolls-Royce has struck an £800m deal with the Ministry of Defence, cementing its place as supplier of nuclear propulsion technology to the military for the next decade.

HMS Vanguard

In a written statement to MPs, Defence Minister Philip Dunne said the contract covered the overhead, running and business costs at Rolls-Royce Submarines sites. Photo: AFP/Getty Images

 

In a deal which the MoD says will save the public purse £200m and sustain 2,000 British jobs, the government has committed to covering Rolls’ overhead costs for the next 10 years.

The contract follows on from an agreement made in June last year, when Rolls secured £1.1bn from the government to revamp its Derby production plant.

It consolidates around 100 existing contracts between the manufacturer and the MoD and is the first of three deals the Ministry is expected to sign.

In a written statement to MPs, Defence Minister Philip Dunne said the contract covered the overhead, running and business costs at Rolls-Royce Submarines sites.

He said the new deal consolidated costs, focussed on efficiency and secured future terms and conditions between the firm and the MoD.

Jason Smith, Rolls-Royce chief operating officer and head of its submarines unit said: “I am pleased that we have agreed this enabling contract with the MoD which delivers significant savings to them over the next ten years and provides us with the stability to deliver these activities efficiently.

“It further reinforces the commitment to the submarine programme.”

The deal was struck weeks before Chancellor George Osborne unveils his 2013 budget, which is widely expected to feature further defence spending cuts, after the MoD absorbed around a fifth of total savings announced in the Autumn statement.

Britain’s 2010 Strategic Defence and Security Review (SDSR) set the course for future UK defence spending, in which the government said it would cut spending by 8pc up to 2015.

Source – The Telegraph