E.On signs £2bn IT outsourcing deal with HP and T-Systems

About 1,400 IT staff will transfer to the services providers, but the energy company will retain its security specialists

Energy company E.On has signed an IT outsourcing deal worth £2bn with IT services providers HP and Deutsche Telekom's T-Systems.

The contract, which has a minimum term of five years and a maximum term of seven, will see the energy giant outsource its IT infrastructure for the first time.

HP will be responsible for end-user computing including management of datacentres and datacentre processing services, which means E.On will no longer be using SAP systems for these services. Backup recovery and web servers will also be hosted by the company. It will also manage desktop printer services as well as office and workplace IT devices.

T-Systems will be responsible for the network and telecommunications services, including the unified communications system. IT systems and tasks relevant to security are not part of the outsourcing deal and will continue to be managed by E.On.

"We want to streamline our IT and make it more efficient in order to maintain our leading role in the increasingly dynamic energy market," said Edgar Aschenbrenner, chairman of the management board of E.On IT, the E.On group's internal IT company.

The move, which is part of E.On's Performance Enhancement Programme, will see some 1,400 internal IT staff transfer to the partner companies, which were chosen partly because of their previous experience of integrating employees into their workforce. The transfers are due to take place in spring 2011.

There is speculation that the deal will result in some job losses but E.On has so far not commented on the issue of redundancies.

The outsourcing deal follows the closure of the company's Rayleigh Customer Service Centre in January, which resulted in the loss of 600 jobs, and the announcement earlier this month that the company was planning to sell off its Central Network business in Coventry, which may lead to a further 200 redundancies.