Alcatel and KCRC sign Euro 12 million agreement on rail signaling in Hong Kong

Paris, January 27, 2005 - Alcatel (Paris: CGEP.PA and NYSE: ALA) announced that it has formalized an agreement valued at Euro 12 million with the Kowloon Canton Railway Corporation (KCRC) to extend the application of SelTrac Communications-Based Train Control (CBTC) to Hong Kong’s Kowloon Southern Link. Alcatel’s world-leading CBTC solution has been successfully operating on the West Rail line since 2003 and on the Ma On Shan line since 2004.

The Kowloon Southern Link, an extension of the existing West Rail system, is a 3.8 km underground twin track that will be formed by extending the overrun tunnel at West Rail’s Nam Cheong station to East Tsim Sha Tsui station.

Under the agreement, Alcatel will provide the design and supply of the SelTrac automatic train control system and KCRC will provide installation, testing and commissioning services.

“We again selected Alcatel due to the successful operation of SelTrac CBTC on both the West Rail and the Ma On Shan line. This proven technology has shown to be reliable, safe, upgradeable and cost-effective. Alcatel also has a solid track record of on-time delivery to facilitate a successful start-up,” said Lr Lee Kang-Kuen, Senior Director Capital Projects, KCRC.

“We are pleased that KCRC has again demonstrated its satisfaction in our capabilities and service, realizing that SelTrac CBTC is integral to a long-term operation solution. This agreement signifies the strength of our business relationship with KCRC,” said Olivier Perraud, Senior VP and GM of Alcatel’s Transport Automation Solutions Urban Rail business.

Alcatel’s SelTrac S40 CBTC system is well known for its high performance, low life cycle cost, moving-block technology that allows short headways and operation with shorter trains for optimal passenger service frequency, allowance for smaller stations, and unattended/driverless operation.

The Kowloon Southern Link system-wide control will be carried out at the West Rail Operation Control Centre located at Kam Sheung Road West Rail Building. Alcatel’s solution includes its NetTrac MT System Management Control, which provides central operators with significant flexibility and automation of many functions.

About KCRC
The Kowloon-Canton Railway Corporation is a public corporation charged with the task of operating and developing domestic, cross-boundary and intercity railway services. The Corporation currently provides three domestic passenger rail services: East Rail, West Rail and Light Rail. In addition to its domestic service, East Rail operates intercity passenger services to Guangzhou on its own train and provides access for other intercity trains running to and from cities in the Mainland including Guangzhou, Shanghai and Beijing

About Alcatel’s Railway Solutions
To meet the challenge of increased mobility, Alcatel offers a host of advanced railway solutions that ensure safe, reliable and comfortable transportation of passengers and freight through the network. Drawing on wide international experience in all aspects of transport automation and network integration and services, Alcatel is a leading worldwide supplier for signaling - train control, train routing, control centers - and integrated communications solutions to carry and distribute voice, data and video to and from all sites of urban and main line rail. Whether enhancing, renewing or building new lines, Alcatel is an ideal partner to address the operational needs of main line and urban rail operators.

About Alcatel
Alcatel provides communications solutions to telecommunication carriers, Internet service providers and enterprises for delivery of voice, data and video applications to their customers or employees. Alcatel brings its leading position in fixed and mobile broadband networks; applications and services, to help its partners and customers build a user-centric broadband world. With sales of EURO 12.3 billion and 56,000 employees in 2004, Alcatel operates in more than 130 countries.

Contact Information

Mark Burnworth

Alcatel

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