GLOBAL – Benefit and human resources services firm Towers Perrin is planning to launch a new HR outsourcing services company with IT outsourcing firm EDS.
EDS will pay $420m (E322m) to Towers Perrin as a part of the agreement, the two firms said. Towers will own 15% of the company.
The as yet-unnamed company would combine Towers’ administration solutions business and EDS’s payroll and related human resources outsourcing. The Towers arm provides pension, health welfare administration services.
The company would be headed by Steve Bohannon, EDS’s vice president of HR services. It will have a board of directors representing both companies.
The combined revenues of the merged entity would to $600m, they said. The transition should be closed by the first quarter of 2005.
The new firm will targets the human resources outsourcing business in the areas of benefits, payroll, compensation management, work force administration and relocation, recruitment and staffing.
It would help clients “optimise” investments in human resources processes and programs and align their HR agenda with their business objectives.
“Through our alliance with the new company, clients can ensure their outsourcing solutions are shaped and informed by the right strategy, program design and implementation,” said Towers Perrin chairman and chief executive Mark Mactas.
Towers Perrin has also awarded EDS a 10-year IT outsourcing contract worth $365m.