Tuesday, 2 September 2008

Not a good day for Liberata

Bob Gogel, the CEO of Liberata who also happens to sit on the Prince's Trust Technology Leadership Group committee that I chair, probably would not rank today as one of his best.

Last year Liberata displaced Capita to win the £80m/5 year contract to administer the Education Maintenance Allowance (EMA) paid to students. "New software that was supposed to replace paper application forms with an online system but this had to be abandoned because it was too slow" Source BBC News. Telephone problems also meant that applicants could not get hold of anyone. Liberata, is to meet all the costs of dealing with the delays and would be hit with a penalty for late delivery of the project.

It's yet more misery for HM Government and Ed Balls in particular who had to deal with the SATs debacle only last month. But, yet again, the IT industry's image is tarnished in the eyes of the public - in this case young students.

Liberata is majority-owned by Private Equity firm General Atlantic. In July Liberata sold their Financial Services BPO operations to Indian HCL. Liberata reported revenues of c£207m in the year to 31st Aug 07 – which would put their continuing non Financial Services revenues on around £180m. In the BPO world that is pretty small so problems on one of, if not their, biggest BPO contracts will really hurt. As I said at the time "The sale to HCL probably increases the chances of a sale of the rest of Liberata. Failing that they will need to ‘bulk up’ pretty quickly – which not be the easiest of things to do right now."

No comments: