LONDON \u2014 Leidos has secured its first major support deal from the UK Defence Ministry, the MoD announced on Thursday. The US contractor was named as the preferred bidder on a multibillion pound program aimed at transforming how commodities are procured and stored for the military.<\/p>\n\n\n\n
Industry sources said Leidos, formerly known as SAIC, beat out opposition from <\/span>local defense support giant Babcock and a bid from an in-house team from the Defence Equipment & Support (DE&S) arm of the MoD.<\/p>\n\n\n\n “Today’s announcement is a key step in bringing defense logistics up to the standard of industry best practice,” Philip Dunne, minister for defense equipment, support and technology, said in a statement. “It will deliver state of the art warehousing systems to improve availability of supplies and better management of inventory for the armed forces.”<\/p>\n\n\n\n An MoD spokesman for the MoD <\/span>declined to confirm the award to the US contractor, but said that <\/span>the department is was <\/span>looking to “make an announcement in the near future.” Leidos representatives in the UK did not respond to a request for comment.<\/span><\/p>\n\n\n\n The Logistic Commodities and Services Transformation (LCS(T)) program is reckoned to be worth around \u00a37 to \u00a38 billion (US $10.7 billion to $12.2 billion) to pounds <\/span>over the 13-year life of the deal, but that figure could rise to as much as \u00a313 billion if the MoD expands the range of products set to be handled under LCS(T).<\/p>\n\n\n\n The deal includes a three-year transition phase.<\/p>\n\n\n\n For the moment, the outsourcing deal includes procurement of commodities such as food, clothing, general stores, some fuels and other items.<\/p>\n\n\n\n Winning the deal is a major breakthrough for Leidos.<\/p>\n\n\n\n The company has secured some defense-related business here but nothing remotely on the scale of the LCS(T) program.<\/p>\n\n\n\n Leidos Senior Vice President executive <\/span>Barbara Doornink told Defense News last year that fuel distribution and ammunition storage and distribution are two areas the company might eye in the future to expand its UK business.<\/p>\n\n\n\n Doornink said she saw “plenty of opportunities in Britain beyond LCS(T) for the sort of integration, IT and other solutions Leidos provides.”<\/p>\n\n\n\n The program is part of wider MoD efforts to transform the efficiency of its equipment and support procurement effort.<\/p>\n\n\n\n Part of the deal will see more than 2,000 DE&S staff move into the private sector under Leidos management.<\/p>\n\n\n\n Under the current organization, each DE&S commodity area operates largely in isolation, resulting in duplication and increased costs.<\/p>\n\n\n\n