Rolls-Royce Holdings plc (2.4%) (LSE:RR)(1,275.00 - London Stock Exchange) provides jet engines, power and propulsion systems, and services to commercial aviation, defense, marine, oil and gas, and other industries. RR has leading engine positions as one of two suppliers for the Boeing 787 Dreamliner and the Airbus A350, two new wide body programs that will provide the company with significant long-term growthopportunities. The delivery of new jet engines also provides recurring, higher margin parts and service revenues, which will benefit the company. In 2012, RR closed on the previously announced arrangement to exit the IAE International Aero Engines AG joint venture, which was a collaboration of four companies to produce the V2500 engine, primarily for a narrow body Airbus A320 program. In return for its equity in the joint venture, RR received $1.5 billion and an unspecified amount for each hour flown by the currently installed fleet of V2500 powered aircraft for fifteen years following the completion of the transaction, which we continue to view positively.
From the Gabelli Value 25 Fund fourth quarter 2013 commentary.