Wragge & Co has advised Cap Gemini on a £55m contract with Prudential Group, in the latest deal for the Birmingham firm’s outsourcing team. The five-year contract is one of the most valuable in the UK financial services sector.
Wragges’ team, led by TMT associate Kate Lewis, advised Cap Gemini, Ernst & Young’s management and IT outsourcing division.
Cap Gemini will provide mainframe and mid-range IT services for Prudential over five years.
The deal is the latest in a series of outsourcing projects the firm has handled recently. Over the last two years, it has also handled a project for British Airways, as well as a £600m property outsourcing contract for British Telecom.
Growth in outsourcing has been rapid in recent years and analysts predict annual growth rates of about 25% over the next five years.
In the IT sector, Wragges partner Bill Jones identifies desktop outsourcing as the area with the greatest growth potential.
Jones said: “It is partly driven by the growth rate and rapid changes in technology. [Replacing technology] is a management problem for businesses and it is non-core.”
Outsourcing is a profitable niche for many firms, including Barlow Lyde & Gilbert, Bird & Bird and Osborne Clarke. Last year, Wragges overhauled its IT, IP and property teams to include outsourcing specialists across its main practice areas.
US firm Shaw Pittman advised Prudential Group.
Wragge & Co outsourcing – key deals
April 2001 – Advising BT on outsourcing a £600m property portfolio Oct 2000 – IT partner Sarah Sasse led a team advising WH Smith on its IT outsourcing. Its five-year contract was worth about £50m
Sept 2000 – Advised BA on its outsourcing project, in which some ground support services were outsourced to Amadeus Global Travel
