BRITISH aero-engine manufacturer Rolls-Royce said on Tuesday that state arms manufacturer Denel is to become the sole supplier of the Rolls-Royce Tay engine gearbox. The agreement is aimed at strengthening SA’s manufacturing industry under the R21,3-billion defence package approved the government last year. Under the agreement, Denel Aviation, a division of Denel, becomes the sole supplier of the gearbox for the Rolls-Royce Tay engine, which could generate around $32-million for the cash-strapped arms manufacturer over a seven-year period. Denel, which is currently being restructured in preparation for the privatisation of certain businesses, already earns $8-million annually as the sole supplier of gearboxes for the Roll-Royce RB211-535 under its risk and revenue sharing arrangement for Trent Engine.