Customs transfer held up

An ICL-led consortium has suffered an embarrassing glitch with its £500m deal with the Customs & Excise after one of its partners delayed the transfer of 250 Customs staff to the IT services company.

The consortium of ICL, Racal, Mitsubishi and Microsoft is overhauling the agency's entire IT and telecoms infrastructure, including rolling out Windows 2000.

The delay occurred when the Bank of Tokyo Mitsubishi, which is financing the deal, sought clarification on the terms of staff transfer.

"We were told some 48 hours before the transfer that ICL's bankers had withheld consent," said a Customs spokesman. "However, if the banks are now happy, we take comfort from that."

The transfer was held up for 10 days.

The final deal was not signed until September 1999, including a month of hesitation as the bank pored over the contract.

ICL said negotiations had not moved as quickly as hoped, but "We are in there and working well with HMCE".