Xansa wins £24m LSC deal extension

IT outsourcer Xansa has won a £24m extension to its existing deal with the Learning and Skills Council (LSC).

The LSC is a government agency responsible for planning and funding vocational training for UK school-leavers and adults and the two-year deal will see Xansa support its IT systems and services.

Xansa's original £12m per year three-year deal with the LSC was signed in 2001 for IT systems development and support. The extension followed a benchmark review of service under the old deal and one of Xansa's responsibilities will be to help the LSC provide a smoother and more efficient funding process.

David Russell, director of resources at the LSC, said in a statement: "This agreement allows the LSC to focus its energies upon proving the joined up information and services that will deliver the transformation of skills that the British economy needs now and in the future."

For Xansa the LSC deal extension is a welcome change from some of its other contracts which have recently been extended and renegotiated for much less than the original deals.

Samad Masood, analyst at Ovum, said many "recycled" outsourcing contracts now mean a reduction in revenues for the IT services vendor.

"The fact that this extension will still be worth £12m per annum to Xansa is a good sign for the company - particularly when the current trend is for contracts to decrease in value as they mature," he said in a research note.