LONDON (BLOOMBERG) - Rolls-Royce Holdings ended talks to raise £500 million (S$881.6 million) from sovereign funds in Singapore and Kuwait and will instead seek to raise £2 billion from existing shareholders, Sky reported.
Current owners opposed the dilution that would occur bringing outside investors into the £2.5 billion fundraising effort, the newspaper reported, citing a person familiar with the matter.
Sky News had earlier reported that Singapore's GIC and Kuwait Investment Office were considering an investment in the engine maker.
The UK maker of aircraft engines is likely to unveil a financing package as soon as Thursday (Oct 1) that also includes additional borrowing power, Sky said.
Rolls-Royce has lost more than 80 per cent of its value this year, touching a fresh 17-year low on Wednesday amid a broad industry downturn triggered by the coronavirus pandemic.
The company has been particularly hard hit by the drop in long-distance travel, which has sharply curtailed demand for the wide-body planes its engines power. Many aircraft in the existing fleet have been temporarily or permanently grounded, depriving Rolls-Royce of vital maintenance revenue it collects when they fly.
Rolls-Royce has also seen its debt downgraded to junk this year, meaning borrowing would come at a higher cost than before the pandemic.