Mumbai: Global IT service provider Tata Consultancy Services (TCS) has signed a five-year, $16 million information technology service contract with AGL Energy Limited (AGL), Australia''s largest retailer of gas and electricity.

Under the agreement, TCS will manage and support all SAP applications for AGL. This includes AGL''s existing SAP ERP system and the SAP industry solution for utilities, which is currently being implemented.

The contract, part of a major technology overhaul at AGL, will allow it to cut down workforce and significantly and reduce the cost of operations, saving the Australian company an annual $12 million for five years.

"The decision to outsource our applications management and upgrade our systems is in line with AGL''s strategy to streamline business operations and offer a competitive service. TCS was selected because of their SAP skills, energy and utilities domain knowledge, proven track record in technology innovations and mature methodologies," Paul Anthony, managing director of AGL, said.

"TCS is delighted to be associated with AGL. This engagement underscores our capabilities in the Asia Pacific energy and utilities markets. It is supported by our global network delivery model, global alliance network and our large regional presence," said Girija Pande, EVP and regional director for TCS Asia Pacific.

TCS has a strong presence in Australia and New Zealand and has been operating in the region for the last 25 years. In 2006, TCS won a $97 million contract with Qantas Airways and acquired a leading Australian consulting unit to broaden its consulting offerings to Australian customers. Today, with over 1,400 professionals, TCS provides services to large customers in Australia.