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Rolls-Royce has agreed to sell its loss-making commercial marine business to Norway’s Kongsberg Gruppen for £500m.

The Derby-based engineer said the sale of the business, which employs about 3,600 people mostly in the Nordic region, will generate net proceeds of around £350m to £400m.

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The announcement comes as the maker of jet engines is in the process of cutting 4,600 jobs in an effort to improve its profitability. Its restructuring plan aims to save the FTSE 100 company about £400m a year.

Warren East, chief executive of Rolls-Royce, said: “This transaction builds on the actions we have taken over the last two years to simplify our business. The sale of our commercial marine business will enable us to focus on our three core businesses and on meeting the vital power needs of our customers.”

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In 2017, the commercial marine business generated revenue of £817m with an operating loss of £70m, Rolls Royce said in a statement. The disposal is expected to have a positive profit impact of around £50m.

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