London Underground to replace Bombardier as prime contractor for signalling upgrade

MONTREAL – London’s transit system is looking for a new contractor to take on a signalling upgrade for four Underground lines, replacing Bombardier Transportation.

Bombardier Inc. (TSX:BBD.B) and Transport for London announced Tuesday they had reached a joint release agreement.

The London transit operator said Bombardier has completed some of the work on the original 2011 contract but it will look for another company to finish the job.

Bombardier didn’t disclose the reason for the decision but a London newspaper reported that its signalling system had proved to be incompatible with the complex infrastructure of the four lines.

The Telegraph’s online edition reported that Bombardier is expected to receive between 80 million and 85 million British pounds, the equivalent of C$140 million and C$150 million.

The original contract was awarded in June 2011, after a competitive bidding process.