CSC wins contract worth pounds 1bn with BAe

COMPUTER Sciences Corporation, the American technology group, has signed a pounds 1bn contract with British Aerospace to run the British company's computer systems for the next 10 years.

CSC said that the contract, won in competition with IBM and EDS Scicon, was the largest of its kind in Europe. The management of computer systems on behalf of other companies - known in the industry as outsourcing - has become one of the fastest-growing parts of the computer business.

Almost 1,500 BAe computer staff will be transferred to CSC under the agreement, which will save BAe up to pounds 10m a year.

A spokesman for BAe said that the staff involved, who work at about 15 locations around Britain, were not likely to be asked to move from their present workplaces despite the transfer. They would not be disadvantaged in terms of salary or conditions of employment.

To manage the contract CSC has set up a new division called Aerospace Systems, which will be based at Farnborough, Hampshire, near BAe's headquarters. Dick Evans, chief executive of BAe, said: 'The nature of the relationship will be one of strategic partnership.' It would enhance BAe's competitive position and allow management to focus on core activities.

BAe's cost-cutting drive is part of an attempt to recover from losses of more than pounds 1.5bn over the past three years. The company is also seeking joint venture partners for its regional jet and turboprop businesses.