HITACHI insists that a £1bn deal to buy train factories in Italy would not pose a threat to its 730 jobs plant in the North-East.

The Japanese firm said it was aiming to become a global leader in train building after it agreed to buy Rome-based Finmeccanica's loss-making AnsaldoBreda train business, and the Italian company's 40 per cent stake in signalling firm Ansaldo STS.

The buy-out, worth a reported £1.3bn, significantly increases the scope of Hitachi’s train and train infrastructure capabilities, giving it the ability to bid for contracts against bigger rivals such as Germany's Siemens, France's Alstom and Canada’s Bombardier.

For Hitachi the most prized part of the deal is Ansaldo STS, a profitable business that would help it to sell combined carriage and signals packages as well as giving it a manufacturing presence on the Continent. It would mean that the Japanese business has major train-making facilities in both Aycliffe and Italy, but Hitachi bosses quashed concerns that the Italy operations would potentially threaten its sister plant in the North-East.

"We do not regard this as a rival to Aycliffe, rather we expect that it will complement what we have in the UK,” said a spokeswoman. “Aycliffe will remain our flagship site in the UK. We have made a significant investment here and today’s announcement does not change our plans,” they added, noting that the County Durham plant, which will start making trains in the new year, had a full order book which is expected to keep its workers busy well in to the next decade.

Alistair Dormer, the global chief executive of Hitachi Rail said: “With the addition of these companies we are in an excellent position to transform Hitachi Rail into one of the strongest global players in the sector. Today’s announcement is a further testament to the long-term vision we have for growth of Hitachi. By combining forces, we significantly strengthen our market position, aspiring to become a leading global total solution provider to the rail sector.”

Part government-owned Finmeccanica is selling the rail unit to focus on faster-growing aerospace and defence businesses and cutting debt at the company. AnsaldoBreda operates four factories, making locomotives, railway cars, trams, and trains for commuter rail, high-speed rail, and main line. It is a world leader in driverless metro trains. The firm has been making steam locomotives since 1854 – the same year that the North Eastern Railway – operator of the East Coast mainline - was incorporated. Hitachi’s Aycliffe plant has the contract to make the next generation of trains for the East Coast route which links the North-East with Scotland and London.

Ansaldo STS has 4,000 employees, with about a third of them in Italy, while AnsaldoBreda has 2,300.

“We will keep the current employees and factories of AnsaldoBreda and we will utilize those of Ansaldo STS,” said Hiroaki Nakanishi , chairman and chief executive of Hitachi. “As for the current management of the Italian companies, our first priority is to utilize the current structure.”

The deal is subject to regulatory approval.

After restructuring to scale back its consumer electronics business, Hitachi has been looking to expand abroad, in areas ranging from train building to power-generation equipment to reduce its reliance on its slow-growing domestic market. The company moved the headquarters of its rail division to London from Tokyo last year after winning an order to supply high-speed trains in Britain.