A few news updates have been released that concern the share prices of FTSE 100 aerospace and defence companies BAE (LON: BA) (BA.L) and Rolls-Royce (LON: RR) (RR.L) in the past few weeks.
Rolls-Royce released a statement regarding Bergen Engines on 23 March. It noted the announcement made by the Norwegian Government, which said that the proposed sale of Bergen Engines to TMH Group must not be allowed to go ahead. As a result, Rolls-Royce has paused the sales process. It also reiterated that it has followed the appropriate process in contacting authorities in advance of the proposed sale.
The planned sale of Bergen Engines forms part of Rolls-Royce’s strategy to raise £2 billion from asset disposals by early 2022. The engine company does not form part of its core strategy, since the manufacture of medium-speed gas and diesel engines is not a key part of its long-term growth plans. It will now seek the assistance of the Norwegian Government to find another option.
As well as news regarding Bergen Engines, there have been a few small director deals in Rolls-Royce shares the past month. They include a sale amounting to just under £1,000 by CEO Warren East, a £980 purchase by Non-Executive Director Lee Hsien-Yang and a purchase of just under £2,000 by Chairman Ian Davis.
In the past month, the Rolls-Royce share price has declined by 9%. In the past year and five years it has fallen by 5% and 55% respectively. It trades at 106p at the time of writing.
Meanwhile, BAE’s share price news over recent weeks has largely contained updates on director deals. Non-Executive Director Carolyn Fairbairn bought 15,000 shares in the company on 23 March for a total consideration of around £74,000.
There were also several awards of free shares to senior management, as well as awards under long-term incentive plans and bonus plans, during the past month. They took place alongside some sales by senior management to satisfy tax liabilities.
Over the past month, the BAE share price has gained 7%. It is down by 5% in the past year, and has risen by 6% over the past five years. It trades at 522p at the time of writing.
Looking ahead, Rolls-Royce’s AGM is due to take place on 13 May. BAE’s half-year results are expected to take place on 29 July, while its shares go ex-dividend on 22 April.
Not Investment Advice
Note: Views expressed are those of the writer. The author does not own any stocks mentioned. The article is information, not advice. Share prices can rise and fall. Past returns are not a guide to the future. Please do your own research.