Serco enters Middle East defence market with Qatar deal

Serco enters Middle East defence market with Qatar deal

LONDON Thu May 8, 2014 4:46pm BST

(Reuters) – Struggling British outsourcing firm Serco (SRP.L) said it had signed its first defence contract in the Middle East – a 26 million pound deal to deliver education courses to officers of the Qatar Armed Forces.

Under the three-year contract with Qatar’s Ministry of Defence, Serco will provide postgraduate-level military education courses for majors and lieutenant colonels in the navy, army and air force, in partnership with Britain’s Ministry of Defence and King’s College London, the firm said on Thursday.

Serco, which operates services around the world from prisons to air traffic control, already does business with armed forces in the United States, Australia and Britain, where it also provides military education courses.

Duncan Mackison, Serco’s managing director for defence in Britain and Europe, described the Qatar deal in a statement as a “significant entry into the defence market in the Middle East”.

Serco has traditionally operated in transport and facilities management sectors in the Middle East, which accounts for 5 percent of its 5.1 billion pounds in turnover. It is now targeting work in other sectors such as defence, education and welfare support.

The group over the past year has been hit by scandals involving contracts with the British government, costly restructuring, falling margins on renewed work and fewer new business wins.

Last week its new boss, Rupert Soames, outlined a nine-month strategy review aimed at restoring its bruised reputation and profits.

(Reporting by Neil Maidment; editing by Jane Baird)

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