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Accenture plc (ACN) recently announced the extension of a Business Process Outsourcing (BPO) deal with Royal Sun Alliance (“RSA”), one of the oldest insurance companies in the UK. The company’s relationship with Accenture dates way back to 2003, when the two signed the original BPO contract.

Royal Sun Alliance is an FTSE 100 company, listed on the London Stock Exchange. It runs general insurance businesses and offers a wide range of insurance products and services to both commercial and personal clients in the UK.

Under the original contract, RSA outsourced certain back-office operations comprising sales and services, claims settlement and some commercial and administrative functions to Accenture. The initial agreement was scheduled to expire in 2010 but was extended in 2009 for two years through to the end of 2012. Now, the contract has been extended yet again for four more years.

Apart from this, RSA awarded a Management Consulting and Application Development contract to Accenture, under which the latter will support the company’s IT applications. This is proof of the dependability of Accenture’s services that enables the insurance company to better serve its clientele.

Accenture has been successful across various industrial sectors as well as geographical regions. Recently, the company won a 5-year consulting and outsourcing services contract from CEVA Logistics and a 2-year information technology services contract from Israel Electric Corporation. Moreover, Accenture’s core banking solution has been deployed by Banco Bilbao Vizcaya Argentaria S.A.’s (BBVA) U.S. banking subsidiary.

Although Accenture was hit hard by the recession, it now appears to be bouncing back. This is evident from a healthy growth in revenue and bookings in the recently concluded third quarter of 2011. However, the economic turmoil in Europe and competitive pressure from International Business Machines Inc. (IBM) could considerably rationalize Accenture’s growth prospect.

Accenture has a Zacks #3 Rank, implying a short-term Hold recommendation.

 
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