Cases & Deals

Goodrich and Rolls-Royce form engine controls joint venture

Clients Goodrich Corporation

Jones Day assisted Goodrich Corporation, a Fortune 500 company, with all agreements necessary to form an engine controls joint venture with Rolls-Royce Group plc. The 50/50 joint venture company, known as Rolls-Royce Goodrich Engine Control Systems Limited, trades as Aero Engine Controls. Aero Engine Controls will develop and supply engine controls for Rolls-Royce engines. Aero Engine Controls will combine Goodrich's existing U.K.-based engine controls design and manufacturing business with Rolls-Royce's Full Authority Digital Engine Control (FADEC) engineering expertise. Goodrich will retain the aftermarket products and services business associated with the joint venture's products. In establishing the joint venture, each party will have transferred approximately £14 million of assets and cash into Aero Engine Controls. In addition, Rolls-Royce will make a cash payment of $100 million to Goodrich Corporation and will assume certain foreign exchange contracts with an estimated cost to Rolls-Royce of £20 million. Aero Engine Controls will have around 1,330 employees, comprising staff who will transfer from the two companies, and has sites in Derby, Birmingham and Belfast. In addition to M&A representation, Jones Day provided antitrust (with clearance by the UK Office of Fair Trading after an investigation of the transaction), employment, environmental, financing, licensing, private equity, real estate, and tax advice regarding this transaction.