ROLLS-ROYCE HAS completed its acquisition of Allison, after clearing the final US regulatory hurdles. Under a deal worked out with the US Government, R-R will be denied access to Allison's work on classified defence programmes.

R-R is focusing on the commercial benefits of taking on Allison's existing range of light-helicopter and large military-turboprop engines. Chairman Sir Ralph Robins describes the company as "an excellent strategic fit", stressing that the product lines are largely complementary to its own turbofan products.

Robins says that only about 3% of Allison's business is on "super-secret", fully funded, US Government programmes, from which its new owners will be excluded access. Management fences have been put in place to prevent the technology from crossing the Atlantic, says Robins.

Such programmes include Allison's leading-edge work on advanced-technology demonstrators under the Pentagon's Integrated High Performance Turbine Engine Technology programme and possibly its proprietary Lamilloy blade-cooling technology.

R-R has yet to announce rationalisation plans, although its US marketing and headquarters operations, headed by John Sandford, will be transferred to Allison.

There are few clashes on existing product lines. The acquisition provides R-R with a route back into the turboprop market, which it quit after deciding not to develop a successor to the Dart. Allison's AE2100 powers the Lockheed C-130J and the Saab 2000 and is also certificated for the IPTN N-250.

There may be some clash with BMW R-R in the small-turbofan market, however, against Allison's AE3007, which have a position on the Cessna Citation X and Embraer EMB-145 regional jet.

In the helicopter-engine market, Allison stands to gain from US Government plans to acquire 523 Bell-Boeing V-22 Ospreys, equipped with the T406.

Allison is also in partnership with AlliedSignal on the T800, already selected for the Boeing Sikorsky RAH-66 Comanche and a leading candidate for other applications in the USA and beyond, including the Hindustan Aeronautics Advanced Light Helicopter.

R-R plans to fund the acquisition through a share issue designed to net £331 million when it is completed in mid-April. The UK group points out that Allison has continued to improve its financial performance, turning round its heavy losses to announce a $6 million pre-tax profit for 1994 on sales of $632 million.

Source: Flight International