Serco buys Vertex public sector arm

Serco Group, the international services company, has increased its public sector exposure with the purchase of Vertex Public Sector Ltd for 55.5 million pounds.

The company said the move would support expansion into new areas of middle and back office support and add further scale to its recently created Global Services division.

Serco now expects this business to bring in revenues of over $1bn and have approximately 50,000 employees.

Try 6 free issues of MoneyWeek today

Get unparalleled financial insight, analysis and expert opinion you can profit from.

Start your trial

Sign up for MoneyWeek’s free twice-daily newsletter.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Sign up

Prior to the deal, Vertex Public Sector was the the UK public sector wing of Vertex Data Science.

It provides business process outsourcing services to UK local and central government.

Major customers in local government include Westminster and Thurrock councils, and in central government include the Child Maintenance and Enforcement Commission and Job Centre Plus.

Serco said the acquisition considerably increased its market presence and further improved the firm's position for large scale outsourcing opportunities.

Chief Executive Christopher Hyman, said: "This acquisition enhances the range of services we offer to the UK public sector as they seek to reduce costs whilst continuously improving outcomes for citizens".

"We are pleased with the important customer relationships it brings and the opportunity to extend and expand these," he said.

The pro forma financial result for the year to 31 March 2012 for Vertex Public Sector was approximately £110m of revenue and £8m of adjusted operating profit.