Capita signs £1.2 billion O2 call centre outsourcing deal

LONDON Tue Jul 2, 2013 9:57am EDT

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LONDON (Reuters) - British outsourcing company Capita (CPI.L) signed a 1.2 billion pounds ($1.83 billion) contract to run O2's call centers on Tuesday, weeks after agreement was reached with unions over terms for workers who will transfer to the firm.

Under the 10-year deal, 2,700 advisers based at four sites in Britain transferred to Capita's management from July 1.

The Communication Workers Union balloted for strike action June but later called it off after reaching a deal with Telefonica UK (TEF.MC), known in Britain as O2, on workers' conditions, including a two-year job guarantee.

O2 opened a voluntary redundancy program for around 1,000 of its employees at Leeds, Glasgow, Preston Brook and Bury shortly after Capita was announced as preferred bidder in May.

Spokespeople for both O2 and Capita said that there was no plan to close sites.

Capita, Britain's largest outsourcing company by market value, upped its organic revenue growth forecasts to at least 8 percent for 2013 when it first announced the deal.

Shares in the company hit a record high in May thanks to large contract wins in the public and private sectors. ($1 = 0.6568 British pounds)

(Reporting by Christine Murray; Editing by David Cowell)

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