Rolls-Royce looks to raise as much as £2.5 billion to deal with Covid-19 blow

Jet engines, manufactured by Rolls-Royce Holdings, sit under covers in the UK. The pandemic has dirupted air travel, heavily affecting companies in the aviation sector including Rolls-Royce. Bloomberg

Britain's Rolls-Royce Holdings is looking to raise around £2.5 billion ($3.2bn/Dh11.8bn) from investors and is in talks with sovereign wealth funds, including Singapore's GIC, the Financial Times reported on Saturday.

The aero-engine maker is planning to launch the equity raise in the first weeks of October, the report added.

A representative for Rolls-Royce declined to comment on the FT report, while GIC did not immediately respond to Reuters' request for a comment.

The Derby-based business has been reviewing funding options for the past few months, including debt and equity, to boost its balance sheet, which has suffered a blow from travel restrictions linked to the Covid-19 pandemic.

Rolls-Royce cut at least 9,000 jobs in May, mainly in civil aviation, due to the slump in air travel.

It also announced last month plans to sell its Spanish unit ITP Aero and other assets in a move to raise at least £2bn.

In July, the group estimated a £1bn outflow in the second half after burning through £3bn in the first half.