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HP grabs Defense deal

The Defense Logistics Agency contract could be worth as much as $290 million for the computing giant.

Hewlett-Packard on Wednesday said it has won a contract that could be worth as much as $290 million from an agency of the U.S. Department of Defense.

Under the deal, the company will help the Defense Logistics Agency build a single IT infrastructure, a goal that's part of the agency's "Enterprise Data Center" program. The project will involve consolidation of the agency's servers, applications and storage, and is expected to reduce its IT inventory.

Additionally, HP said, the arrangement will expand the agency's disaster recovery and continuity-of-operations programs.

The contract is for a five-year period, with an option for annual extensions for another five years. The $290 million value is based on the cost of a full 10-year partnership. The company said work will be staggered over time to minimize disruptions in customer service.

The Defense Department recently awarded a contract to software maker WebMethods to develop logistics technology based on radio frequency identification, or RFID, for delivering supplies to U.S. troops overseas.