RYCEY Rolls Royce Holdings PLC (PK)

By Tapan Panchal

LONDON--Rolls-Royce Holdings PLC (RR.LN) said Wednesday that it has agreed to a establish a equally owned joint venture with Liebherr-Aerospace for manufacturing a power gear box for Rolls-Royce's new UltraFan engine.

The joint venture, located in Friedrichshafen, Germany, will provide production engineering for the power gear drive train components.

The aerospace and defense company said its UltraFan engine could be ready for service from 2025 and will offer at least a 25% improvement in fuel burn compared with the first generation of Rolls-Royce Trent engines.

Liebherr-Aerospace is a supplier of systems for the aviation industry.

Shares of Rolls-Royce at 0907 GMT trading 0.7% higher at 969 pence each.

Write to Tapan Panchal at tapan.panchal@wsj.com