ITNet signs new £7 million deal
Article Date: Oct 12 2000Outsourcing business ITNet has signed a £7 million deal with Cambridge City Council. ITNet said it had been awarded preferred supplier status to provide IT services to the council.
The contract win followed a difficult beginning to the month for the technology group. It suffered a severe blow to its share price last week when it revealed a revenues and benefits contract with the London Borough of Hackney could be terminated.
Shares plunged to a year low of 255p following the revelation that Hackney Council wished to end the contract, which was initially awarded in November 1997, with an estimated value of £70 million over ten years.
ITNet indicated when it released its interim results earlier this year, that it had been having difficulty with revenues and benefits contracts due to newly introduced government measures.
At the time of the results the company said: 'These contracts have been more difficult to implement and required more investment than originally envisaged'.
However, ITNet's Cambridge deal lifted the price slightly by 2.5p to 267.5p during Thursday trading. This contract is set to run for five years, but is subject to final negotiations that should be completed by the end of October.
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