Buxton bails out of Rolls-Royce

Richard Buxton has sold his shares in Rolls-Royce.

Buxton bails out of Rolls-Royce

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The Old Mutual Global Investors chief executive has joined the ranks of those who have lost faith in the troubled engine maker recently. 

An OMGI spokesperson confirmed a newspaper report that Buxton has decided to sell his 3% stake following a series of profit warnings over the past two years.

Buxton reportedly said the lack of accurate profit forecasting has raised the suspicion that the company’s management do not have a grasp of how the business will perform going forward.

The dividend recently being placed under review also set off alarm bells for Buxton as it indicates the company has a ‘cash issue’.

The news is just the latest blow for the company, which saw another one of its leading supporters Neil Woodford abandon ship earlier this month.

The management has pinned its hopes for a turnaround in fortunes on a transformation programme announced on 12 November, with further changes due to be announced in February 2016.

The company has already removed a layer of management and restructured into a simplified five division model.

Shares in Rolls-Royce have lost 34% over the past 12 months and today are trading at 574p for a market cap of £10.55bn. 

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