IBM Signs $1.4 Billion Global Strategic Outsourcing Agreement With AstraZeneca

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LONDON - 16 Jul 2007: (Updated to include additional details)

IBM (NYSE: IBM) today announced that they have signed a $1.4 billion, seven-year global strategic outsourcing agreement with AstraZeneca. The agreement renews and expands on the scope of an existing contract and covers the provision of IT infrastructure services to 60 countries. It includes services to additional functions within AstraZeneca, one of the world's largest pharmaceutical companies.

In the terms of the agreement, IBM will provide a single global technical infrastructure, managing IT services for AstraZeneca across its global organisation. This includes server and storage hosting, service desks, PC management, network and communications services, including e-mail, and computer operations support. AstraZeneca will retain control of its overall IT strategy and the development and support of its application systems.

Richard Williams, Chief Information Officer of AstraZeneca, said, "This innovative agreement with IBM will enable AstraZeneca to deliver greater value to the business by providing consistent infrastructure services globally, enabling a faster and more efficient rollout of new technology, with improved levels of service. Leveraging IBM's global delivery capabilities and economies of scale, will allow AstraZeneca to focus its efforts on adding value to its scientific, commercial and supply operations, thereby helping the Company to deliver more medicines that make a meaningful difference to patients. In allowing IBM greater autonomy on methods of delivery, the agreement will result in cost efficiencies when compared with running in-house systems."

"IBM will marshal its global resources to provide a flexible and agile infrastructure enabling AstraZeneca to continue implementing its plans to grow and lead in the pharmaceutical industry," said Doug Elix, Senior Vice President, IBM. "The trust we have built over the past seven years will help IBM and AstraZeneca break new ground in transformational services in the next seven."

The agreement was signed in July 2007.  IBM said it expects to recognize approximately $700 million of the total amount of the agreement as new business signings in the third quarter 2007. The balance will be recognized as new business signings during the remainder of the term of the agreement.

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