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Capita shares rally as M&S extends digital customer contact partnership by further five years

In a statement, Capita said the contract renewal and expansion commences April 2018 and is worth approximately £70mln over the contract term
M&S store
As part of the new agreement, Capita will also extend its customer services support to M&S’s international online business

Capita PLC (LON:CPI) saw its shares rally today on news high street retailer Marks & Spencer PLC (LON:MKS) has extended its longstanding digital customer contact partnership with the outsourcing group by a further five years.

In a statement, Capita said the contract renewal and expansion commences April 2018 and is worth approximately £70mln over the contract term.

READ: Capita shares drop as Prudential terminates contract for UK life and pensions administration

The FTSE-250 firm said the extension will see it continue to provide quality customer service support for across voice, online and webchat channels from its existing award-winning teams, including those based in Preston Brook in the UK.

As part of the new agreement, Capita will also extend its customer services support to M&S’s international online business in markets like the US, Australia and France.

READ: Capita shares drop as it warns of 'subdued' outsourcing market

Jonathan Lewis, Capita’s chief executive officer said: “Marks & Spencer’s extension and expansion of its partnership with us is testament to the strength of our longstanding relationship and our consistent delivery of high quality services rightly associated with this brand.

In mid morning trading, Capita shares were up 2%, or 9p at 397.5p, having dropped on Tuesday following news that financial services blue chip Prudential PLC (LON:PRU) has decided to transfer the administration of its UK life and pensions business to a new supplier on July 31.

Capita had said it expects the Prudential contract to contribute revenue of around £80mln in 2017. The group said it will continue to administer Prudential's international operations.

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