Rolls-Royce said it would undertake a sweeping restructure of its business that would involve the evaluation of strategic options for its commercial marine operation.
The restructure would also see the engineering company merge five business units into three, based around civil aerospace, defence and power systems.
The naval marine and nuclear submarines businesses would be consolidated within the existing defence business, while civil nuclear would operate within the power systems business.
The mergers would facilitate a more fundamental restructuring of support and management functions in particular, the company said.
It added that it would deliver an additional reduction in costs and assist the company in improving performance.
Further details would be given at the time of the 2017 financial results release on March 7.
"Building on our actions over the past two years, this further simplification of our business means Rolls-Royce will be tightly focused into three operating businesses, enabling us to act with much greater pace in meeting the vital power needs of our customers," chief executive Warren East said.
"It will create a defence operation with greater scale in the market, enabling us to offer our customers a more integrated range of products and services. It will also strengthen our ability to innovate in core technologies and enable us to take advantage of future opportunities in areas such as electrification and digitalisation."
"Alongside the simplification into three operating businesses, we must continue to address the cost and complexity of the structures that support and serve these businesses, including our corporate head office, with greater decisiveness."
At 1:11pm: (LON:RR.) RollsRoyce Group PLC share price was +47.5p at 901.1p