PeopleSoft Inc yesterday extended its outsourcing relationship with Corio Inc by announcing an equity investment in the company and naming Corio as a preferred application service provider (ASP) partner. Under the agreement, Corio is committed to providing application hosting and management solutions for PeopleSoft’s line of enterprise resource planning applications, specifically the financial and manufacturing modules. Customers pay a monthly fixed fee for Corio to host and manage their applications and servers, which users then access over the internet. PeopleSoft first announced the partnership with Corio back in October last year and today’s news represents the software vendor’s first investment in one of its outsourcing partners which also include KPMG, CSC and USinternetworking.

A spokesperson for PeopleSoft declined to disclose the size of the stake but added that it was intended to enable the companies to tighten their partnership and streamline integration between the two. Also under the announcement, Corio and PeopleSoft said they will participate in joint marketing and sales activities to promote the combined software and service offerings. PeopleSoft sales representatives will receive training from Corio on the ASP model and its value to emerging and mid-market customers. As a preferred partner, Corio can also sell and market PeopleSoft’s software directly, delivering faster turn-around to its customers, the companies said. Corio markets what it calls high growth companies and its existing line-up of PeopleSoft users include Clarent, Excite and Vertical Networks. A spokesperson for the company said Corio was planning to expand into other markets including, for example, customer relationship management software from the likes of Siebel Systems Inc or Vantive Corp, among others. PeopleSoft first announced its certified outsourcing partner program last October, just a month after database giant Oracle Corp unveiled its own outsourcing arm, Business OnLine.