UK government officials scrutinise American activist investors buying up Rolls-Royce amid plummeting share price and repeated profit warnings
Government officials are reportedly keeping a close eye on Rolls-Royce after American activist investors doubled their stake in the struggling aircraft engine maker.
ValueAct, a California-based hedge fund, raised its stake in Rolls-Royce from 5.4 per cent to 10 per cent last month, fuelling expectations that it would seek a seat on the firm’s board and work with other investors to influence the company’s strategy as it tries to rebound from four profit warnings in the last year and a plummeting share price.
The Sunday Times reported over the weekend that the government, which has a “golden share” allowing it to control strategic decisions at Rolls-Royce, was “on alert” over ValueAct. A business department spokesperson would not confirm the report, but told City PM: “Rolls-Royce is a big contributor to the UK economy,” adding, “We continue to work closely with the company.”