(Alliance News) - Serco Group PLC on Wednesday said it has won a contract to continue providing support services at a military air base in Goose Bay, Canada, for at least 10 more years.
The initial 10-year period will be worth as much CAD694 million, equivalent to around GBP400 million, Serco said. The contract has provision for two 5-year extensions, meaning it would be worth as much as CAD1.5 billion, or GBP870 million, if it lasts the full 20 years.
Shares were up 2.0% to 140.10 pence in London.
Serco, an outsourcing company based in Hampshire, said it expects annual revenue of GBP20 million to GBP30 million in the "opening years" of the contract, similar to its revenue from the existing agreement. Serco has provided services to the Goose Bay air base since 1998. The new contract was awarded after an open tender process and starts in September.
"Goose Bay has been operated successfully by Serco for more than 20 years and we are delighted to have been selected to continue to support the Canadian Department of National Defence on what is a vital piece of national infrastructure," Chief Executive Rupert Soames said.
By Ivan Edwards; ivanedwards@alliancenews.com
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Serco (SRP)