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Alstom Disputing Bombardier Rail Purchase

April 28, 2022
The $6.4-billion purchase of Bombardier Transportation made Alstom the world’s second-largest manufacturer of railroad systems – but now the seller is defending its role in the transaction.

Bombardier Inc. has pledged to defend its role in the 2021 sale of Bombardier Transportation to Alstom S.A., after the French engineering group filed a request for arbitration over that transaction. Although it offered few details, Alstom’s request to the International Chamber of Commerce involves an allegation that Bombardier is in breach of certain contractual provisions.

The specific allegations have not been announced.

The sale negotiated in 2020 was completed in January 2021 at a cost of $6.4 billion. The Canadian manufacturer had earlier sold its interests in the commercial aerospace sector, choosing to consolidate its operations in the private and corporate aviation market.

Bombardier Transportation holdings designed and built rolling stock, signaling and communication technology, and components for urban and mainline rail systems. The purchase made Alstom the world’s second-largest manufacturer in the railroad sector.

In its only comment on the allegation, Bombardier stated it has “good grounds to defend itself against Alstom’s claim and intends to do so vigorously. As noted in its press release dated January 29, 2021, Bombardier also intends to challenge certain purchase price adjustments which resulted in proceeds from the Transaction being lower than initially estimated.”

Bombardier also advised its investors that the Alstom arbitration proceedings could last several years.

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