Knorr-Bremse finalizes acquisition of Alstom Signaling North America

Knorr-Bremse has just finalized the acquisition of the conventional rail signaling business of Alstom Signaling North America. The investment represents a milestone in Knorr-Bremse’s strategic progress toward long-term profitability and sustainable growth. It will enable Knorr-Bremse to enter North America’s attractive market for signaling technologies (Control, Command and Signaling, CCS), which the company intends to enhance and globalize by developing new and digital solutions.

Alstom has sold its North American conventional signalling business for approximately 690 million USD, following the binding agreement signed on 19 April 2024. Closing of the sale completes the execution of the company’s 2 billion EUR deleveraging plan. This divestiture was part of the comprehensive company action plan that Alstom announced on 15 November 2023, aiming at reinforcing its balance sheet. Alstom has delivered all three components of that plan, and it results in the stabilisation of its Investment Grade rating.

For this transaction, Alstom was accompanied by Crédit Agricole CIB as financial advisor, White & Case LLP as legal advisor, Cleary Gottlieb Steen & Hamilton LLP as antitrust advisor, and Accuracy for financial due diligences. Alstom will continue to serve the North American signalling market on different segments, notably with CBTC and ETCS solutions.

Marc Llistosella, CEO of Knorr-Bremse AG: “Our new rail signaling technology business in North America is both market-leading and high-margin – and thus an excellent fit with our Group strategy BOOST 2026, which is focused on long-term profitability and sustainable growth. Our entry into the North American signaling market is an outstanding example of Knorr-Bremse’s drive to create even greater value as we further develop our portfolio by entering new, highly promising areas of business. The acquisition also contributes to another strategic objective: to further enhance the Rail side of Knorr-Bremse’s business activities.”

With this transaction, Knorr-Bremse has acquired the conventional signaling product portfolio, sales, service, and manufacturing operations of Alstom Signaling North America, primarily in the USA and Canada. The nearly 800 team members will become employees of KB Signaling, a standalone business under the North American rail organization. With two production plants and numerous engineering facilities in the USA, the new business unit operates in six major locations. Over the last financial year ending 31 March 2024, Alstom Signaling North America generated around 300 million EUR in revenues with an EBIT margin of around 16 %.

Five broad categories make up the new KB Signaling unit’s North American conventional CCS platform and solutions: wayside train and crossing control, and relays and track products – solutions that make up the vast majority of the portfolio, in addition to onboard train control, train supervision, as well as a robust set of Wayside Intelligence solutions, including data analytics. With coast-to-coast coverage, the portfolio is Buy America compliant and supported by solid R&D.

On this basis, the company’s new Signaling business unit is already well positioned in the North American signaling market and ready to further expand its leadership by offering innovative CCS solutions. In the medium term, Knorr-Bremse aims to establish itself as an international Tier 1 systems and platform partner for train manufacturers, rail operators, and infrastructure and signaling technology firms. The company’s existing business activities in the European signaling market will be folded into the Signaling business unit.