Capita in £128m double takeover

Capita has bought two firms which specialise in public sector work for £128.5m.

The outsourcing contractor, which is hoping to benefit from a deal bonanza as local councils farm out work to save money, spent £86m on SunGard Public Sector, which supplies IT, radio networking services and communication systems to the NHS, police forces and the Highways Agency.

Capita also spent another £42.5m on BSI Holdings, a hotel booking and meetings management agency whose clients include the Crown Prosecution Service, Marks & Spencer and easyJet.

Paul Pindar, Capita's chief executive, is hoping the acquisitions will enable the company to pick up public sector work in the wake of Sir Philip Green's efficiency review which said Whitehall departments could save billions on areas such as travel.

Pindar said: "With central Government looking to drive down travel and subsistence costs for public sector workers significantly, we will be in a strong position to help achieve these aims both in terms of greater overall efficiency and reduced unit costs.

"Given the cuts in funding which the sector faces next year, one which provides real opportunities for the group to add value."