Capita awarded UK defence ministry contract, beating Serco, union says
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EDINBURGH, June 18 (Reuters) - British outsourcer Capita (Taiwan OTC: T1614Y.TWO - news) has been awarded a British Ministry of Defence contract to provide defence workers and firefighters, the Unite union said on Monday.
Unite said Capita (LSE: CPI.L - news) had beaten rival Serco although Capita was yet to officially confirm the deal and no one from the company was available for comment.
Capita which provides IT-led services for the public and private sector, is trying to pay down debt, boost investment after a period in which it took on more work than it could profitably handle.
The defence ministry contract would be a win for Capita's new boss Jonathan Lewis who has just tapped financial markets in a 680 million pound rights issue.
However, Unite described the government's decision to award the contract as "wrong-headed and alarming", coming in the wake of the collapse of Capita's service company rival Carillion earlier this year.
Carillion (Frankfurt: 924047 - news) , a major government contractor, went into liquidation under the weight of poorly performing contracts and debt in January, prompting a period of reflection in the sector about how to adapt better to the changing business climate. (Reporting by Elisabeth O'Leary, editing by Andy Bruce and Michael Holden)