Rolls-Royce plans to sell its Michell Bearings subsidiary to British Engines Limited for an estimated $19 million, according to a statement by the aerospace and diesel engine manufacturer. Rolls said the sale would be completed during the third quarter of this year, pending resolution of certain license agreements.
Michell Bearings designs and manufactures hydrodynamic bearings for various marine and industrial applications. It maintains a manufacturing base at Newcastle-upon-Tyne, England, and a 51% share in Michell Bearings (India) Pvt. Ltd., at Bangalore, India. The business has been an operating division of Rolls-Royce Marine since 2000.
The seller said the proceeds would be used to fund working capital requirements. Michell Bearings reported gross assets estimated at $20.1 million in 2014 and generated consolidated profits estimated at $8.9 million at the close of 2014.
British Engines, also headquartered at Newcastle-upon-Tyne, is a consortium of six manufacturing businesses that produce a range of products: valves, hydraulic motors and pumps, cable carriers, electromagnetic clutches and door, and contract machining services. Along with Michell Bearings, it announced an agreement to buy the Rolls-Royce Training School in Newcastle, from Rolls-Royce plc.
It said Michell Bearings would comprise the seventh engineering company in the British Engines group.
“Michell Bearings’ products complement British Engines’ existing products and fit well with the group’s focus on value added engineering,” according to Richard Dodd, chief operating officer. “We are looking forward to working with the business to provide the investment in people and resources required for future growth.”
Michell Bearings lays claim to the original hydrodynamic bearing design — in which the load was carried upon hydrodynamic oil films generated by a series of pivoting white metal- (or Babbitt-) faced pads —patented by Anthony G.M. Michell in 1905. The same principle was applied to both thrust and journal bearings and is known now as the Michell bearing. The Michell Bearings Ltd. manufacturing concern was established in 1920.
The current organization produces hydrodynamic bearings for industrial or marine engines, for machinery, generators, turbines, gearboxes, etc.
“The agreement announced today will allow Rolls-Royce to concentrate on the core areas of our Marine business where we can add most value,” explained Mikael Makinen, president of Rolls-Royce Marine. “It will also present Michell Bearings with fresh opportunities by aligning the business with British Engines, which has a long history in the North East of England.”
Makinen made no comment on the future of the Michell Bearings organization, but pledged “full support to employees who are impacted by the change.”