Rolls-Royce share price: Group looks to sell diesel parts maker

Move comes as CEO looks to revive British engine maker’s fortunes

Rolls-Royce share price: Group looks to sell diesel parts maker

Rolls-Royce Holdings (LON:RR) is planning to sell a German diesel parts maker, The Sunday Times has revealed. The move is part of the chief executive Warren East’s plans to revive the troubled engine maker’s fortunes.

Rolls-Royce’s share price has been steady in London in early morning trade, having climbed 0.22 percent to 891.00p as of 08:29 GMT, outperforming the broader UK market, with the benchmark FTSE 100 index having slipped into negative territory and currently standing 0.34 percent lower at 7,355.36 points. The group’s shares have added more than 35 percent to their value over the past year, and are up by about a third in the year-to-date.

L’Orange sale on the cards

The Sunday Times revealed yesterday that Rolls-Royce was seeking buyers for L’Orange, which makes diesel injection technology for huge trucks and generators. Investment bankers from Goldman Sachs are handling the sale, which could fetch as much as £300 million.

L’Orange, which is based in Germany, has about 1,000 staff, and its equipment is used by industrial giants including Wartsilla and Caterpillar, as well as Rolls-Royce’s own diesel engines.

The sale will come as the British engine maker continues to recover from a string of profit warnings, as well as a hefty settlement over allegations of corruption and bribery stretching back two decades. 

Rolls-Royce updated investors on its recent performance this month, revealing continued weakness at its Marine division. 

Analysts on Rolls-Royce

The 18 analysts offering 12-month price targets for Rolls-Royce for the Financial Times have a median target of 758.00p on the shares, with a high estimate of 1,208.00p and a low estimate of 560.00p. As of November 18, the consensus forecast amongst 22 polled investment analysts covering the blue-chip group advises investors to hold their position in the company.   

As of 08:48 GMT, Monday, 20 November, Rolls-Royce Holding PLC share price is 893.50p.

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