Rolls-Royce has secured a £2billion debt lifeline as it races to raise cash to survive the Covid-19 pandemic.
The engineer had only been expecting to sell £1billion of bonds – but it doubled this after eager investors pledged to buy the debt.
The bond sale was part of a plan to raise £5billion through a package that also includes securing government financing and going cap in hand to shareholders.
Cash call: Rolls-Royce’s bond sale was part of a plan to raise £5bn through a package that also includes securing government financing and going cap in hand to shareholders
The iconic company has been hammered by coronavirus, which has triggered a collapse in global air travel and starved Rolls of income it usually makes from servicing plane engines.
In August it admitted it is struggling for survival and warned that a longer or deeper-than-expected downturn could kill off the company.
The bond offering is a show of faith after the FTSE 100-listed engine maker’s debt was downgraded to junk status earlier this year by all three of the most influential ratings agencies Moody’s, S&P and Fitch.
Boss Warren East has described the coronavirus crisis as the company’s ‘darkest hour’ since the 1970s – when it went bust following a difficult contract and had to be nationalised to bail it out.
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