Two of the world's biggest engineering firms are gearing up for a 1bn-euro (�610m; $871m) legal tussle, after failing to resolve a dispute over the sale of a rail subsidiary.

Bombardier, the Canadian maker of transportation equipment, said it would be filing a claim for damages against German-US car maker DaimlerChrysler.

The claim is in regard to the value of assets Bombardier acquired via the purchase last year of train maker AdTranz from the German firm.

DaimlerChrysler, according to Bombardier, made contractual guarantees on Adtranz's value, which proved to be misleading after accounting revision under the US rules, and the disclosure of some hidden costs.

The two firms have been in discussion over the valuation for some months, but those talks have now broken down.

Train driver

Adtranz is the world's leading manufacturer of rail technology.

It has built trains for the Central Line of London Underground, as well as participating in the French TGV and German ICE high-speed train projects.

Bombardier, which is mainly focused on aerospace technology, paid $725m for Adtranz, in a deal that was completed in April last year.

At the time, there were reports that the Canadian firm was unhappy with the price tag, but Bombardier pressed ahead with the deal.