Rolls-Royce's 1987 float was massively oversubscribed; it became the #2 aero-engine maker

Rolls-Royce had been rescued and nationalized in 1971 after the RB211 engine project nearly bankrupted it. Under state ownership it recovered, and in April 1987 the government launched the offer for sale: ordinary shares at £1.70 each, a market capitalization of £1,362.5 million, with more than 800 million shares available and employees offered free shares.

The response was spectacular. The $3.08 billion sale was heavily oversubscribed — more than one million separate applications arrived by the deadline — and the institutional share of the issue was cut from 50 to 40 percent to make room for individuals. Dealers quoted a premium within minutes of the deadline, giving applicants an instant paper profit.

Privatized Rolls-Royce then compounded: freed from state budgets, it pursued civil engine programs and built the Trent family that powers the largest Airbus and Boeing jets. By 2010 it was the world's number two aero-engine manufacturer, with an order book that had grown from £7.6 billion in 1995 to £58.3 billion.

The £1.36 billion flotation drew over a million applications; by 2010 Rolls-Royce was the world's number two aero-engine maker with a £58.3 billion order book.

The company was technically strong when sold — the 1971 failure had been fixed by engineering, not by ongoing subsidy.

A mass retail offer at a fixed price created broad ownership and genuine market demand.

Employee share schemes aligned the workforce with the company's performance.

Private ownership freed management to fund long-horizon engine programs and international expansion.

Privatization works when the company is technically strong before the sale and management is free to chase long-horizon programs: Treasury oversight, not engineering, had been the constraint.

Rolls-Royce remained a British industrial flagship through the 2000s, diversifying into marine, energy and nuclear systems with only about a fifth of revenue from defence. Later profit warnings and the pandemic-era collapse in flying hit the civil engine business hard, but the 1987 privatization is still regarded as one of the UK's most successful state sell-offs.