28th Jan 2015 09:25
LONDON (Alliance News) - Capita PLC on Wednesday said it has won the race to buy Constructionline from the UK government's Department for Business, Innovation and Skills in a GBP35 million, cash-free and debt-free basis.
Constructionline, a procurement and supply chain management services business, was created by BIS initially to work on public sector contracts. Capita won the original tender to run the business in 1998 and successfully retained the contract in subsequent tenders, it said.
Capita said it intends to invest in the business with an initial focus on the construction market, but with a view to expanding is services into other sectors. It will invest in a new IT system for the business as part of these plans.
"Capita has run Constructionline successfully for more than 16 years, building one of the largest buyer and supplier service organisations of its kind, helping buyers achieve compliance and returning regular income to BIS and the tax payer. But under public sector ownership, there have, understandably, been a number of constraints to the service reaching its full potential," said Capita Chief Executive Andy Parker.
Parker said Constructionline currently provides services to fewer than 15% of suppliers in the construction sector, and it intends to expand the business with a view to increasing revenue by 40% in the next two years.
Capita shares were up 0.9% to 1,103.00 pence on Wednesday.
By Sam Unsted; [email protected]; @SamUAtAlliance
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