Farnborough, UK. 11 July 2016. Rolls-Royce Holdings plc announces that it will purchase the outstanding 53.1% shareholding in Industria de Turbo Propulsores SA (“ITP”) owned by SENER Grupo de Ingeniería SA (“SENER”). The acquisition strengthens Rolls-Royce’s position on its Civil Aerospace large engine growth programmes by capturing significant additional value from its long-term aftermarket revenues, including the high volume Trent 1000 and Trent XWB engines, where ITP has played a key role as a risk and revenue sharing partner. It also enhances the group’s manufacturing and services capabilities and adds value to the Defence Aerospace business, particularly on the TP400 and EJ200 programmes.

Rolls-Royce will pay SENER a total consideration of €720m, subject to due diligence, for the outstanding 53.1% of ITP. This follows a decision by SENER to exercise its put option. Under the existing shareholder agreement, consideration will be settled over a two year period following completion in eight equal, evenly spaced instalments. The agreement allows flexibility to settle up to 50% of the consideration in the form of Rolls-Royce shares. Final consideration as to whether the payments will be settled in cash, or cash and shares will be determined by Rolls-Royce during the payment period. Completion, which is subject to regulatory clearances, is expected in early 2017.

Warren East, Rolls-Royce, CEO, said: “We welcome the opportunity to acquire the outstanding stake in ITP. ITP has been a trusted partner for Rolls-Royce over many years as well as working for other engine manufacturers. This investment will add to our aerospace capability, with excellent facilities, services and products, to generate additional opportunities for profitable growth. We look forward to forging a closer and more productive future together, and to welcoming ITP’s employees into Rolls-Royce. I would like to thank SENER for their close relationship over three decades as we have built this exceptional business.”

ITP’s 2015 revenues were €710m, EBITDA was €116m and profit after tax was €59m. Gross assets as at 31 December 2015 were €1.7bn.

Jorge Sendagorta, SENER, President, stated: “We inspired the creation of ITP in 1989 and, over the years, supported the extraordinary management and professionals of the company with a focused long-term investment strategy based on best-in-class technology and production. We are extremely proud of the great achievements of ITP, but our mission is now complete and the time has come when it is Rolls-Royce who can build the best future for the company. SENER will now concentrate on the expansion of our core engineering business, dedicating more resources to our ambitious international strategy and to R&D. Thank you Rolls-Royce and ITP for these three decades of fruitful creation together.”

ITP is a  company which designs and manufactures aero engine components for a range of customers. It has partnered with Rolls-Royce on all Trent programmes, manufacturing Low Pressure turbines, and is currently researching alongside Rolls-Royce new Intermediate Pressure turbine technology for the next generation UltraFan™ engine. It has research and development expertise, particularly in the field of aerospace super-alloys, and engine maintenance capabilities. ITP is headquartered in Bilbao, Spain, and employs over 3,000 people in facilities in Spain, Mexico, India, Malta, US and the UK.

Ignacio Mataix, ITP, CEO added: “I am delighted that we are joining the Rolls-Royce family. We have already worked together to create outstanding aerospace products and services which will generate long term value. The acquisition will create new growth opportunities, while maintaining our current portfolio and strengthening our global position. I am sure it will provide significant opportunities for our employees across the business.”