LONDON (ShareCast) - (ShareCast News) - Avingtrans took a chunk of the ailing Rolls-Royce group on Friday, announcing the purchase of its internal pipe manufacturing business and the two related facilities in Nuneaton, UK and Xi'an, China.
The AIM-traded company said the deal was worth £3.5m, which was to be funded by the company's existing debt facilities.

Avingtrans said the new owner of Rolls-Royce's pipe business was Sigma Components, which formed its aerospace division.

"Sigma has developed a strong relationship with Rolls-Royce over a number of years, by supplying components for numerous engine programmes", the company's board said in a statement.

The firm said that, as well as strengthening the group's UK manufacturing footprint, the Chinese facility would complement Avingtrans' existing operations in Chengdu and further enhance Sigma's offering to the aerospace industry in the region.

"Sigma will use the combines capabilities of its UK and Chinese facilities to offer competitive commercial terms to Rolls-Royce, as the XWB programme grows rapidly", the board said.

The plant at Nuneaton employed 132 people, while there were 110 working at the Xi'an facility. Avingtrans said operations would continue at both sites following the deal's completion.

"This acquisition is a key part of our strategy to support Sigma's growth with investment in businesses and technologies that complement our existing capabilities", said Avingtrans CEO Steve McQuillan.

Avingtrans described its existing operations as designing, manufacturing and supplying critical components, modules and associated services to the aerospace, energy and medical sectors.

At 1215 GMT, shares in Avingtrans were up 1.9%, trading at 107p. Rolls-Royce Holdings shares had climbed 0.65% to 545.5p.

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE