Foods and beverage giant agrees seven year contract with EDS

Kraft Foods has signed a $1.7bn (£940m) seven year IT services agreement with EDS.

Under the terms of the agreement EDS will take responsibility for Kraft's entire IT infrastructure, including managing desktops and servers for the food company's 60,000 employees worldwide.

The deal will also make EDS responsible for providing Kraft with services including data centres, hosting, telecommunications and workplace support, as well as managing hardware and software for the whole company.

Approximately 670 Kraft staff will transfer to EDS to help with the process of integration and help create what EDS calls a next generation global delivery system, capable of reacting quickly to shifting dynamics in the global food market.

Forrester analyst Stephanie Moore says the size of the deal goes against recent outsourcing trends towards smaller deals.

'My guess is that Kraft is clearly getting some kind of up-front capital investment from EDS, which will be very attractive for them,' she said,

'I would also guess that EDS will sub-contract a lot of this work to other vendors and manage that for Kraft, which would also help account for the size of the deal.'