Rolls-Royce, United Technologies Scrap Engine Partnership Accord

Rolls-Royce Holdings Plc (RR/) and United Technologies Corp. (UTX) said they’re no longer pursuing a joint venture to power future airliners seating 120 to 230 passengers.

“Because of the current regulatory environment, the parties have agreed not to proceed with the partnership,” London-based Rolls and United Technologies said in separate statements. Neither company commented on the nature of the obstacles to the pact, which would have brought together the world’s No. 2 and No. 3 engine-makers after General Electric Co. (GE)

Rolls-Royce and United Technologies announced plans to cooperate on turbines for mid-sized jetliners in 2011 as part of a restructuring of the International Aero Engines joint venture involving MTU Aero Engines AG and Japanese Aero Engine Corp. Rolls sold its stake to UTC for $1.5 billion while retaining a supplier role on V2500 engines used by Airbus SAS (EAD) A320 planes.

“Rolls-Royce remains fully committed to this important market segment and will continue to invest in technologies that will enable us to take advantage of opportunities as they arise,” the U.K. company said.

When they first agreed to team up, Rolls and Pratt said they’d focus on high-bypass-ratio geared turbofan technology and work on a variety of different engine designs within a midsize market for about 45,000 turbines over two decades.

Pratt & Whitney said today it would “continue independently” to develop applications of the geared turbofan after betting heavily on a technology that this week powered Bombardier Inc. (BBD/B)’s CSeries plane on its first flight.

A version of the powerplant will also be used by Airbus on its A320neo and was selected by Brazil’s Embraer SA (EMBR3) to re-engine its regional-jet family and for the Mitsubishi Regional Jet.

Rolls-Royce has focused its research on other engine concepts for the next-generation mid-size planes.

To contact the reporter on this story: Robert Wall in London at rwall6@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net

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