Rolls Royce announces non-executive director’s departure from the company

Formerly known as a luxury car manufacturer and later a British aero-engine manufacturer, Rolls Royce announced on Tuesday morning that Bradley Singer has announced his departure from ValueAct Capital’s board. ValueAct Capital is one of the biggest Rolls Royce shareholders and an activist investor. Bradley Singer has served as a Chief operating officer at ValueAct for four years. Singer’s resignation hit the share prices hard which were reported to have declined by over 4% in the early session. The significant drop made the aero-engine manufacturer a top loser on Tuesday, as per the analysts of Britain’s bluechip FTSE 100 index.

ValueAct Has A 9.35% Stake In Rolls Royce

Based on Thomson Reuters data, ValueAct currently has a 9.35% stake in Rolls Royce. Back in 2016, when Singer was welcomed on the board, Ian Davis had announced in his capacity as a chairman that Singer would remain in the board as long as ValueAct continues to be a sizeable investor in Rolls Royce. As per the Jefferies’ analysts, Singer’s resignation is not expected to weigh on ValueAct’s reputation as one of the largest investors in Rolls Royce.

“We think it inevitable some will interpret the board change as signaling ValueAct is imminently going to reduce its shareholding, but such was the Relationship/Confidentiality Agreement between Rolls-Royce, ValueAct, and Bradley Singer that we believe there to be no substantive change”.

ValueAct’s spokesman refused to comment on the news or provide any insight into the company’s future trading plans at this stage. Rolls Royce had announced ValueAct’s shareholding in the company in 2015. At the time when Singer joined as a non-executive director in 2016, the company was facing a period of turmoil. As of Tuesday, upon his resignation, however, Singer expressed confidence in the company’s overall performance.

ValueAct Can Invest And Hold Its Stake For 10 Years Or More

As per the announcement on the website, ValueAct declares that it traditionally invests and holds stakes for as much as five years. In exceptional cases, however, the investment company has the potential to hold its shares for ten years or even more. Rolls Royce’s performance in the stock market has remained challenged for the most part in 2019. The stock opened at 809 GBX and recorded upward rallies that printed a year-to-date high of 988 GBX in February. The high was then followed by a consistent streak of downward movement that recently printed a yearly low of 692 GBX at the start of December. The aero-engine manufacturer is currently valued at $13.44 billion.