Feb 5 (Reuters) - French train maker Alstom

has agreed to sell its Görlitz plant in Germany to defence

equipment maker KNDS, the companies said on Wednesday.

KNDS will start using the plant this year to produce

assemblies for the Leopard 2 battle tank, the Puma infantry

fighting vehicle and variants of the Boxer wheeled armoured

vehicle, they said in a joint statement.

Alstom's production of trams and double-decker trains in

Görlitz will either continue or be relocated during the

transition, depending on the status of the project, they added.

Alstom and KNDS will continue to employ about 580 staff of

the current 700 at the factory, either there or at alternative

sites, they said.

The sale is in line with Alstom's strategy to restructure

its German operations to boost competitiveness and

profitability, a company spokesperson told Reuters.

"As many sites are ramping up including digital and services

capabilities, the carbody shell activity is largely being

discontinued," the spokesperson said.

Alstom has been implementing cost efficiency measures with

an aim to focus on activities that offer higher margins and less

risk exposure.

The French group is trying to cut debt and improve its

finances, stretched in part because of problem contracts it

inherited through its 2021 acquisition of Bombardier's

rail business.

The companies did not disclose financial details of the

plant sale, which they said was expected to be completed by

2027.