P&G awards £1.9bn outsourcing contract to HP

Procter & Gamble has agreed "in principle" to award a giant IT outsourcing contract to Hewlett-Packard valued at £1.9bn over 10...

Procter & Gamble has agreed "in principle" to award a giant IT outsourcing contract to Hewlett-Packard valued at £1.9bn over 10 years.

The two companies expect to sign a definitive agreement by mid-May.

Both Electronic Data Systems (EDS) and Affiliated Computer Services last year went into final negotiations with P&G that eventually fizzled out.

The contract calls for HP to manage P&G's IT infrastructure, data centre operations, desktop environment, networks and some applications development and maintenance. The scope of the services is global, applying to P&G's operations in 160 countries.

About 1,850 P&G employees will go to work for HP, most of them from P&G's Global Business Services unit.

P&G said it chose HP for its cost, quality of service and technical expertise. If the contract is finalised, it would be a very significant win for HP as it continues to strive to improve its position within the IT services space.

Bolstering its service arm was one of the stated goals of HP's acquisition of Compaq.

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