The return of airliners flying at supersonic speeds has moved a step closer with aerospace heavyweights Rolls-Royce and Boeing backing a British company developing engines capable of powering aircraft at 2,500mph.

Reaction Engines has agreed a £26.5m fundraising round with the industry giants, as well as blue-chip financial backers Baillie Gifford and Woodford Investment.

The Oxfordshire-based business is building “Sabre” – short for Synergetic Air Breathing Rocket Engine – a new design which combines a conventional jet with a rocket.

This means it can work like a normal jet, then as it hits high speed can switch to operating as a rocket which does not need air as it reaches altitude where the atmosphere thins.

As well as supersonic passenger flight, the technology could hasten the arrival of low-cost satellite launches. Being able to operate as a rocket fuelled by liquified oxygen means Sabre could be used to power spaceplanes which take off and land like conventional aircraft, rather than current rockets which are expensive as they burn up on re-entry.