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EDS wins Flemish government deal

Electronic Data Systems and a Belgian telecommunications company win a five-year contract likely worth $500 million to provide information and communication technology services to the Flemish government.

Electronic Data Systems, a computer services company battered by bad news in recent months, announced on Friday it and a Belgian partner have signed a $500 million deal with the Flemish government.

EDS said it and Telindus Group will provide information and communication technology services to the Flemish government for five years. These services will include application development and maintenance, security, and user support.

The deal is a "provisioning" agreement, meaning its value depends on the number of services bought over the five years. The Ministry of the Flemish Community estimates it will spend $513 million on information and communication technology during that time, according to EDS.

The contract was signed Friday, and EDS and Telindus will begin work in August.

"This contract is a real milestone for EDS Belgium and strengthens our position as market leader in the Belgian IT (information technology) outsourcing market," said Yvan Morel de Westgaver, managing director of EDS Benelux.

The Ministry of the Flemish Community is a Belgian government agency representing the country's six million Flemish speakers. Belgium has about 10 million people overall.

Belgium-based Telindus Group is the parent of Telindus, which focuses on data communications and network integration.

The Flemish government contract comes after nine months of grim news for EDS, one of the world's largest IT services companies. It has weathered a drastic earnings shortfall, a U.S. Securities and Exchange Commission probe and a management shakeup.

In May, EDS reported a first-quarter net loss of $126 million, or 26 cents per share, due in part to a $334 million cumulative loss associated with a Navy-Marine Corps intranet contract. EDS is based in Plano, Texas.