Ac­tivist fund ValueAct takes a seat on the top ta­ble at Rolls-Royce

Yorkshire Post - Business - - BUSINESS -

ROLLS-ROYCE HAS given US ac­tivist share­holder ValueAct a seat on its board in a move that will give the in­vestor in­flu­ence over the en­gine maker as its seeks to turn around its for­tunes.

Rolls said Bradley Singer – a part­ner and chief op­er­at­ing of­fi­cer at San Fran­cisco-based fund ValueAct – would be­come a mem­ber of the sci­ence and tech­nol­ogy com­mit­tee.

The de­ci­sion to give an ac­tivist fund a seat on the board of a FTSE 100 firm is highly un­usual, but comes af­ter Rolls had lengthy talks with ValueAct, which is the group’s largest share­holder, hold­ing 10.8 per cent stake.

Ian Davis, chair­man of Roll­sRoyce, said: “Bradley Singer has an out­stand­ing record as a busi­ness leader.

“He brings with him ex­pe­ri­ence of pub­lic com­pa­nies dur­ing pe­ri­ods of change, growth and sig­nif­i­cant fi­nan­cial out­per­for­mance, par­tic­u­larly in the US where Rolls-Royce has im­por­tant busi­ness in­ter­ests and a sig­nif­i­cant share­holder base.”

Rolls and ValueAct have also signed a so-called re­la­tion­ship agree­ment, cov­er­ing share deal­ings and other cor­po­rate gov­er­nance mat­ters.

Rolls has been slash­ing costs and re­struc­tur­ing af­ter a string of profit warn­ings.

The group last month re­vealed that an­nual prof­its tum­bled by 12 per cent to £1.4bn in 2015, but this was less than ex­pected as the firm’s cost-cut­ting has be­gun to take ef­fect.

Rolls-Royce had warned over prof­its five times in two years, more re­cently hit by weak de­mand for cor­po­rate jet en­gines in emerg­ing mar­kets and tum­bling crude oil prices im­pact­ing its marine op­er­a­tions.

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