Computer Sciences lands $450 million deal

In a sign that the information technology outsourcing market remains healthy, Computer Sciences on Thursday said it snagged a $450 million, 10-year IT outsourcing deal with facilities services company ISS.

Under terms of the agreement, El Segundo, Calif.-based Computer Sciences will assume responsibility for the full range of IT services at more than 800 ISS sites throughout Europe. Computer Sciences will provide services related to mainframe computers, desktop machines, and application development and support.

Subject to certain conditions, about 120 ISS employees will transfer to Computer Sciences in Europe starting June 1.

Although IT spending overall has been weak in recent years, IT outsourcing--when companies farm out tasks such as managing data centers and handling help-desk requests--has been relatively strong. Consulting firm TPI estimates that the total value of IT outsourcing deals worth more than $200 million rose from $38.8 billion in 2001 to $41.4 billion last year. Market research firm Forrester Research says IT outsourcing is the fastest-growing segment of the technology services market--expanding at a 14 percent annual rate through 2007.

Copenhagen, Denmark-based ISS has more than 250,000 employees and provides services such as cleaning, landscaping and pest control.

Computer Sciences has about 90,000 employees. The company reported revenue of $11.3 billion for the 12 months ended March 28.