NRMA sell-down casts IT shadow

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NRMA sell-down casts IT shadow

NRMA Motoring insists the provision of its IT services are not at risk, despite reports of growing tensions between the company and its spin-off Insurance Australia Group (IAG), which shares the NRMA brand name and provides it a number of crucial IT services.

NRMA Motoring spun off its insurance arm in 2000, the latter rebranding as IAG in 2002.

According to a report in the Sydney Morning Herald, a complex series of agreements between the two firms includes a deal under which NRMA Motoring pays IAG up to $10 million a year to use IAG's branch network, IT systems, call centres and back-office assets.

This arrangement – and all others between the two firms – is reportedly in doubt after NRMA Motoring sold down almost half of its IAG holding in secret.

The Sydney Morning Herald reported Monday that the sell-down was aimed at forcing a restructure to the way IAG and NRMA Motoring work together.

Spokesmen for both companies have disputed reports of a boardroom rupture over the share sell-down.

An NRMA spokesman said the motoring services company's relationship with IAG "worked quite well".

An IAG spokesman similarly said the two organisations were "committed to a positive and mutually-beneficial relationship.

"There's a strong alignment of interests, contrary to any allegations [otherwise]," the spokesman said.

IAG was reported to have been scoping IT outsourcing arrangements with a range of IT services firms in April.

The firm had previously outsourced to IBM GSA deal in a deal that expired in 2003.

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