Rolls-Royce bounces back with $ 2.6 billion US Air Force contract
Prestigious British manufacturer Rolls Royce signed a multi-billion dollar contract with the US Air Force in a deal that has already proven to be beneficial to the company’s stock. Tracked down by the US military, Rolls-Royce was entrusted with the delivery of the Air Force engines, which allowed the company’s F-130 engine – made in the United States – to power the B- 52 Stratofortress over the next 30 years.
New deal sees Rolls-Royce strike multi-billion US Air Force deal
“With eight engines on each B-52 aircraft, 58 in active operational service plus an additional 18 in reserve and 12 in long-term storage, re-engineering the B-52 Stratofortress is a very big deal to be won,” says the analyst. at Wheeldon Strategic Advisory, Howard Wheeldon, impressed with the scope of the contract.
The Rolls-Royce Indianapolis plant will host the development and construction of the company’s F-130 engines, with new and upgraded military-grade equipment being tested on-site following the $ 600 million plant refurbishment. dollars.
“The F-130 is a modern, efficient and proven engine that is a perfect match for the B-52,” says President and CEO of Rolls-Royce North America, Tom Bell.
Obtain contracts to bounce back from the pandemic
It has been an eventful few years for the British automaker following a shocking 61% drop in sales due to uncertainty surrounding its Trent 1000 engine and, like almost every other business in the world, suffering disruption from the pandemic. .
But the company is picking up and gradually getting back on its feet, making high-end deals and buying big-budget deals in a bid to bounce back. And with the slow integration of air travel into society and the economy as Covid vaccinations and non-quarantine vacations resume, inventory has grown by almost 160% in the past year.
Shares jumped 10% after the deal was signed, to Â£ 14.98 (US $ 20.53) to Â£ 147.48.
Rolls-Royce’s rebound continues with the 100% sale of its ITP Aero unit for a comfortable US $ 2 billion, and the company has now comfortably met its mid-2020 divestiture target.