Bombardier sues Daimler

February 14, 2002 Posted: 1131 GMT

LONDON (CNN) -- Bombardier is seeking damages from DaimlerChrysler over the sale of its train making unit to the Canadian transportation conglomerate.

Montreal-based Bombardier is seeking damages of 1 billion ($873.4 million) from the German-American carmaker related to the value associated with Bombardier's purchase of Adtranz.

Bombardier paid DaimlerChrysler $725 million in cash for Adtranz in May 1999. The Canadian company said DaimlerChrysler had made contractual guarantees about Adtranz value.

But talks with DaimlerChrysler had failed to reach an agreement on the issue.

Its claim for damages is "largely based on material breaches of contractual representations and guarantees, including significant deficiency in the value of adjusted net assets acquired," the company said.

The claim will be filed under the arbitration process governed by the rules of the International Chamber of Commerce.

DaimlerChrysler said on Thursday it viewed as unjustified the damages claimed by Bombardier.

"DaimlerChrysler views the damages claims sought by Bombardier as unjustified and unfounded in every respect," said DaimlerChrysler board member Manfred Bischoff in a statement.

He added that DaimlerChrysler would use all means possible to fight the claim.

DaimlerChrysler shares rose 0.1 percent to 44.04 in midday trading on Friday in Frankfurt.