Alstom plans to raise €1bn (£870m) to reduce debt as the world’s second-largest train maker struggles with order delays due to concerns over the future of its Derby factory.
The Paris-listed company will seek investors with the aim of raising funds by September. The company also plans to issue 750 million euros in bonds as part of a new 2 billion euro capital plan.
Alstom’s finances have been under scrutiny after delays in customer orders, including those in the UK, raised concerns about cash flow and the future of its Derby rail factory. The company acquired the site from Canada’s Bombardier in 2021, making it the world’s second-largest rail manufacturer after China’s CRRC.
A slowdown in orders last year put 1,300 jobs at risk and raised concerns for factory workers. But now there is hope that operations at the historic site, which has been in production since 1876, may be protected.
Last month, Transport Secretary Mark Harper met with Alstom executives and announced that the UK Department for Transport would support Alstom in funding a further five Elizabeth Line trains, in addition to the five Elizabeth Line trains confirmed in March. It was announced that a “general agreement” had been reached. . He added that he was confident that “a solution is in sight.”
Alstom has also been affected in the UK by uncertainty surrounding ordering new trains for HS2, following Rishi Sunak’s decision to scrap the northern section of the high-speed line from London to Manchester as originally planned. ing. The trains were to be built at Hitachi’s factories in Derby and Newton Aycliffe, County Durham.
Alstom is also winding down its operations as part of a debt reduction plan. The strategy will see the sale of a stake in rolling stock manufacturer TMH for 75 million euros in January and the transfer of the North American signaling business to Knorr-Bremse for 630 million euros, with the deal expected to close later this year. It is.
Alstom announced its full-year results, announcing that its net debt as of March 31 was 2.99 billion euros, compared to 2.13 billion euros in the same period last year.
Alstom announced that its order book for the period April 1, 2023 to March 31, 2024 was 18.9 billion euros, compared to 20.7 billion euros in the previous year. Adjusted net profit decreased to 44 million euros from 292 million euros in the previous year.
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Henri Poupard-Lafarge, Alstom Chairman and CEO “We recorded a strong recovery.”
The British government chose Derby in March as the headquarters for its new rail regulator, the Great British Railway, in part because of the city’s heritage. The Derby factory manufactures rolling stock for trains across the UK, most recently on London’s Elizabeth Line.
