Transfield Services Ltd (ASX:TSE) has signed an $88m deal with the University of Newcastle as part of their strategy to enter new growth markets.
Transfield Services Ltd is an Australian company that was founded in 1998 and is a provider of operations and maintenance, asset management, project and capital management outsourcing and infrastructure development services in several countries around the globe. They are also currently the operator of the Manus Island Regional Processing Centre.
The deal marks Transfield’s entry into the tertiary education market as the company aims to broaden its scope of growing sectors. Transfield Services’ Managing Director and CEO, Graeme Hunt, said: “The tertiary education sector, along with the defence, social and property sectors, represent exciting growth markets for Transfield Services. The engagement with the University of Newcastle supports Transfield Services’ successful expansion into the tertiary education sector with a key customer.”
The deal is for a period of 5 years and includes integrated facilities management and a property services contract across its metropolitan and regional campuses in New South Whales, and is set to commence in July. The deal includes a provision to extend the scope of work to provide capital and upgrade works.
The agreement comes not long after Transfield signed a 5 month contract extension with New South Whales Land and Housing worth $45million and a 9 month contract extension with Gold Coast University Hospital for $12million. Giving Transfield a total of $145million in newly obtained contracts.
The market however seems undeterred by the positive increase in new contracts and this has reflected in a slight downtrend on their share price in the last few months. It is likely that we may see more positive sentiment towards Transfield in the future if the increase in work reflects positively on financial reports. Transfield is currently trading on the ASX at $14.30.
Author: Imran Valibhoy
Jun 26, 2015
Since Joining the firm in 2006, Imran has worked on a range of M&A and Capital Market transactions in the natural resources, mining as well as projects in the renewable energy sector. Prior to joining Wise-owl, Imran worked at Euroz Securities in Perth, aiding in the advisory and valuation of companies in the mining and industrial sectors in Australia. Imran has a Masters in Banking & Finance from City University's Class Business School in London and a Bacheloor degree in Commerce from UWA.