UK to sign 13 year LCST contract with Leidos
Following successful negotiations, the UK Ministry of Defence (MOD) announced its intention to sign a 13 year logistics programme contract with Leidos on 24 March. The contract award is planned for April this year.
Leidos was confirmed as a preferred bidder for the contract in February. Under this contract, it will run and improve efficiencies in warehousing, procurement and stock control of food, clothing, general and medical supplies as well as storage and distribution.
The contract is part of the MOD's Logistic Commodities Services Transformation (LCST) programme, aimed at providing logistics services to the UK armed forces that are in line with industry best practice.
This is the first MOD tender of this scale for its logistics functions and marks a major change in how it stores and distributes military equipment and supplies, and procures and manages the inventory of common commodities such as food, clothing, packed fuel and medical supplies.
Leidos' bid includes a team of defence and logistics specialist subcontractors, including Kuehne + Nagel, TVS, Agility and Thales.
Philip Dunne, Minister for Defence Equipment, Support and Technology, said: 'I am pleased we are able to confirm this transaction with Leidos which will bring the military’s logistics, commodities and support services up to the standard of industry best practice, deliver more efficient and effective processes across the supply chain and enhance the quality of support provided to our armed forces.
'This will generate significant savings of around £0.5 billion over the life of the contract, representing good value for money for the taxpayer and, in due course, will deliver state of the art fulfilment to our inventory management processes and systems. The transaction will involve the TUPE transfer of some 1,250 staff.'
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