Alstom nears $700 mn deal to settle US corruption charges
17 December 2014
French engineering giant Alstom is nearing a deal to pay $700 million to the US Justice Department to settle corruption charges related to paying bribes in Indonesia and other countries, according to several media reports.
Alstom's US subsidiary in Connecticut along with its Japanese joint venture partner Marubeni are alleged to have paid millions of dollars in bribes to an Indonesian parliament member and other officials in order to secure a $118-million contract for providing services at a power plant in Sumatra.
Three executives of Alstom's US unit have since pleaded guilty and admitted paying bribes on behalf of the company.
The settlement comes at a tricky time for Alstom, which recently agreed to sell most of its power business to US conglomerate General Electric for $16.9 billion.
Alstom is also under a probe by Britain's Serious Frauds Office for having paid around $8.5 million in bribes over a six-year period to win transport contracts in India, Poland and Tunisia. (See: Alstom paid bribes to win Delhi Metro contract, finds UK probe)
The British investigation was initiated after information from the Swiss attorney general, which ordered Alstom to pay 38.5 million Swiss francs ($41 million dollars) for corporate negligence in 2011 because it had failed to stop bribery.
In India, Alstom companies have a turnover of about Rs940 crore, and employ about 2,600 people. It is a majority shareholder in Alstom Projects India Ltd and has a joint venture with Bharat Heavy Electricals Ltd in India.
Alstom group has won four major orders worth Rs330 crore for equipment supplies and Renovation & Modernization (R&M) work on four power plants in India.
These orders were from National Thermal Power Corporation Limited (NTPC), TATA Power, NALCO and GEA Energy Systems (India) Ltd.
Alstom Projects India makes nuclear reactors and rotors. Alstom is a world leader in conventional nuclear projects. It makes turbines for nuclear power stations.