3 counting on outsourcing IT

Three UK - the 3G mobile outfit owned by Hutchison Whampoa - is looking to outsource its IT development work to Siemens, sources claim.

At this stage it's not known how far negotiations have progressed. Staff have yet to be told of the changes although insiders say that an official announcement is due shortly and could be made before the end of the month.

Details of the outsourcing remain sketchy, but it's understood that part of the reason for the move is to cut costs at the mobile phone outfit ahead of a bid to float the business.

The UK arm is expected to hit positive EBITDA this year, and parent group Hutchison Whampoa may look to float it before mid-2006. A spokesman for 3 UK was asked to respond but declined to comment on "rumour and speculation". As did a spokesman for Siemens.