Computacenter snatches £120m from under Bull's nose

A partnership between consultancy CMG and Computacenter has scored a £120m PFI contract to provide a complete IT infrastructure for the UK Health and Safety Executive (HSE).

The deal will provide hardware, software, support and consultancy for HSE for the next ten years, and represents a big blow to the current contractor Bull Integris.

Geoff Neville, chairman of CMG Admiral UK and Ireland, said: "We're absolutely thrilled to get this contract. It represents the culmination of 18 months of work with the HSE - we decided that this was a contract we wanted to win."

Neville hopes to increase mobile technology at the government agency.

CMG Admiral beat fellow bidders Compaq/Logica, Sema Group and incumbent Bull Integris to the lucrative contract. It represents good news for the IT services firm, which has had a rocky ride since buying UK consultancy Admiral a year ago.

Despite the news, CMG shares fell four per cent in London today after a bad review by analysts earlier in the week. Speculation that it is to be bought seems to have dried up, along with revenue growth from its software processing text messages on mobile phones.

All of this, coupled with a May profit warning, has contributed to an 85 per cent fall in value in the year since it acquired Admiral.

CMG Admiral said it won this contract because of its focus on services and commitment to build a partnership with the government agency. With Computacenter it will provide the hardware and software for 4,500 desktops and will develop new applications as required.

It will also supply consultancy and helpdesk functions.

Helen Donlan, project manager for the deal at the HSE, admitted it was putting all its IT eggs in one basket: "The deal really is providing us with everything. However, we felt CMG offered us value for money and a company ethos we felt we could relate to."

CMG spent 18 months and committed up to 25 people to a bid team to win the contract. Incumbent Bull Integris said in a written response it was "obviously disappointed to have lost the HSE contract," but refused to comment any further.