Serco Jumps to 12-Year High on Medicare Contract: London Mover
Serco Group Plc (SRP) jumped to the highest price in more than 12 years after the U.K. services company won a contract worth as much as $1.25 billion for support tasks for U.S. Medicare and Medicaid health plans.
The operator of prisons and London’s Docklands Light Railway rose as much as 6.6 percent to 666 pence in London, the highest price since October 2000. The stock was up 5.4 percent at 659 pence as of 10:38 a.m., extending the Hook, England-based company’s gain this year to 23 percent.
Serco was awarded a cost plus fixed-fee contract by the Centers for Medicare & Medicaid Services for a 12-month base period starting on Oct, 1, with an option for four more 12-month periods. The company’s duties will include intake and troubleshooting of applications for programs including children’s health insurance and the basic health program. A Serco spokesman declined to comment.
The company may try to increase its U.S. work in areas such as health care, air traffic control and business process outsourcing to help offset government spending declines, Chief Executive Officer Christopher Hyman said in August. The company operates in more than 30 countries and has more than 120,000 employees, according to its website.
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