Re Joint Venture

28 May, 2008

    ROLLS-ROYCE AND GKN AEROSPACE ANNOUNCE COMPOSITE MATERIAL JOINT VENTURE    

Rolls-Royce announced today that it has established a joint venture company
with GKN Aerospace to carry out research and development into the use of
composite materials in aero engine fan blades.

As part of its continuous drive to bring innovative products to market,
Rolls-Royce is researching key technologies and alternative materials to
further enhance the efficiency and environmental performance of its products.

Funding for the research and development is expected to be approximately £11
million. Rolls-Royce will fund and own 51 per cent of the venture, with GKN
Aerospace responsible for 49 per cent.

The joint venture activities will build upon the development of composite blade
applications undertaken during the EU-funded VITAL programme, and will combine
the expertise of Rolls-Royce advanced engine technologies with GKN Aerospace's
composite research and automated manufacturing technologies.

Rolls-Royce Director - Research and Technology Ric Parker said: "Rolls-Royce
has been working closely with GKN Aerospace on the latest carbon-composite
technologies for some time and we look forward to building on this relationship
with the formation of the joint venture. The composite technology research that
this organisation will undertake is aimed at delivering light-weight and
low-cost fan blades for engines for the next generation of airframe
applications."

GKN Aerospace Chief Executive Officer Marcus Bryson said: "We have long been a
pioneer and driving force in the application of lightweight, high-performance
composites to the airframe and it is one of our strategic goals to bring the
benefits of composite materials to propulsion systems. This JV represents a
critical step towards achieving that goal. Through our partnership with
Rolls-Royce, we will achieve a genuine advance in propulsion system technology
that will move us towards a lighter, more environmentally efficient
aero-engine."

Notes to editors:

 1. The joint venture agreement provides that in certain limited circumstances,
    Rolls-Royce may be required to purchase GKN's shares in the joint venture
    at fair market value.
   
 2. Rolls-Royce, a world-leading provider of power systems and services for use
    on land, at sea and in the air, has established a strong position in global
    markets - civil aerospace, defence aerospace, marine and energy.
   
 3. The Group has a broad customer base comprising more than 600 airlines,
    4,000 corporate and utility aircraft and helicopter operators, 160 armed
    forces, more than 2,000 marine customers, including 70 navies, and energy
    customers in nearly 120 countries. It employs around 38,800 people
    worldwide people in offices, manufacturing and service facilities in 50
    countries and has businesses headquartered in the UK, US, Canada, Germany,
    Scandinavia and China. This global presence allows the Group to access
    long-term international growth opportunities with its technology, presence,
    partnerships and people.
   
 4. Rolls-Royce continues to invest in core technologies, products, people and
    capabilities with the objective of broadening and strengthening the product
    portfolio, improving efficiency and enhancing the environmental performance
    of its products. These investments create high barriers to entry.
   
 5. Each year, in collaboration with its partners, Rolls-Royce invests over £800
    million on research and development, two thirds of which has the objective
    of further improving the environmental aspects of its products. The primary 
    technology investment area is aimed at reducing noise and emissions.
   
 6. Sixty per cent of research and development investment and 40 per cent of
    new product development spending over the past five years has been outside
    the UK. Research and development is carried out in facilities in the UK,
    Germany, Italy, Singapore, Japan, the US and Scandinavia, with particularly
    strong relationships with the 29 universities where there are Rolls-Royce
    University Technology Centres.
   
 7. Annual sales were £7.4 billion in 2007, of which 55 per cent came from
    services revenues. The firm and announced order book at the end of 2007
    stood at £45.9 billion, of which aftermarket services represent 30 per
    cent, providing visibility of future levels of activity.
   
For further information

Mark Alflatt
Director of Financial Communications
Rolls-Royce Plc
[phone]