Alstom sues GE for breach of train signal sales contract
By Jonathan Stempel
NEW YORK (Reuters) - French rail transport company Alstom SA (ALSO.PA: Quote) has filed a U.S. lawsuit accusing General Electric Co (GE.N: Quote) of breach of contract related to last November's sale of the American industrial conglomerate's train-signaling business.
According to a complaint made public on Tuesday night in U.S. District Court in Manhattan, Alstom and GE have been unable to resolve disputes over whether the $800 million purchase price should be adjusted, up or down, to account for working capital and net debt.
Alstom said GE has breached the contract by refusing to let the jointly designated independent accounting firm Deloitte resolve the disputes, and by instead launching an arbitration proceeding with the International Chamber of Commerce business group.
The lawsuit said Fairfield, Connecticut-based GE's actions have caused Alstom unspecified damages. It seeks to force GE to stop the arbitration proceeding, let Deloitte sort out the issues and abide by whatever Deloitte decides.
GE said in a statement, "We disagree with the allegations and look forward to resolving the matter as provided for in the contract."
The train-signaling transaction was completed on the same day GE bought Alstom's energy business for what GE called an adjusted price of 9.7 billion euros ($10.8 billion).
GE has been repositioning itself around industrial units such as energy and aviation, while turning away from other businesses including finance and home appliances.
Alstom's lawsuit is dated May 13 but was originally filed under seal. Continued...