Kuwaitis eye Rolls stake

KUWAIT’s sovereign wealth fund was last night said to be in talks about buying a stake in Rolls-Royce.

The struggling British engineering giant reported a record annual loss of £5.4bn last month and is looking at ways to drum up £2.5bn from investors.

Among its options are raising cash by issuing new shares or debt, with the Kuwait Investment Office said to be interested in buying shares, according to Sky News.

The talks have emerged after Singapore’s Government Investment Corporation was also said to have expressed an interest.

Rolls-Royce denied any decisions had been taken yet ‘as to whether or when to proceed with any such options, the precise amount that may be raised, or any allotment of shares to any investor including any sovereign wealth fund’. The coronavirus pandemic has plunged the global aviation industry into crisis, with international travel still heavily restricted.

That has prompted financial trouble for Rolls, which gets paid according to how many hours planes using its engines are flown. And it has been hit particularly hard because it only makes engines for larger aircraft that fly long-haul routes, which have been worst-hit in the crisis.

Rolls believes business will not pick back up to 2019 levels until 2025. It has already announced plans to cut 9,000 jobs and said factories in Nottinghamshire and Lancashire will close.

Experts have warned the Government could be forced to step in to save the 114year-old firm from collapse.