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

The FTSE 250-listed outsourcing group said Prudential has decided to terminate the contract as part of a wider customer and technology transformation programme
Outsourcing
Capita said it expects the Prudential contract to contribute revenue of around £80mln in 2017

Capita PLC (LON:CPI) saw its shares shed 5% on Tuesday after the outsourcing group announced that Prudential PLC (LON:PRU) has decided to transfer the administration of its UK life and pensions business to a new supplier on July 31.

In a statement, the FTSE 250 listed outsourcing group said Prudential has decided to terminate the contract as part of a wider customer and technology transformation programme.

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

The company noted that it expects the Prudential contract to contribute revenue of around £80mln in 2017.

Capita said it will continue to administer Prudential's international operations.

The group also said the contract termination is unrelated to previously disclosed discussions with a separate, undisclosed life and pensions client, which remain ongoing.

In afternoon trading, Capita shares were down 5%, or 22p at 398p.

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