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October 10, 1999

IBM Japan Wins Record Outsourcing Contract

By CBR Staff Writer

IBM Japan Ltd has won the largest outsourcing agreement ever concluded in the manufacturing industry in Japan, a 50bn yen ($472m), 10-year deal with car maker Mazda Motor Corp. Under the terms of the contract, Mazda will outsource most of the development and operation of its information systems to IBM. It will be responsible for the development, operation and maintenance of Mazda’s host systems, supercomputers, 10,000 personal computers and network links, with the exception of those in research and development areas.

To support Mazda, IBM Japan will next month establish a wholly-owned subsidiary, IBM Global Services Japan Chugoku Solutions Co. The new company will be fully financed by IBM Japan and will have an initial staff of about 350, including staff from Mazda’s wholly-owned information systems subsidiary, Mazda C&T Ltd which will be dissolved next March. The new IBM company will not be dedicated only to Mazda and will actively look for other outsourcing contracts in Western Japan where it will be located.

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