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IBM signs 7-year service agreement with Electrolux

SAN FRANCISCO, June 1 (Reuters) - International Business Machines Corp. (NYSE:IBM - News) said on Sunday it signed an agreement with Electrolux AB (Stockholm:ELUXb.ST - News), maker of Frigidaire appliances and Eureka vacuum cleaners, to manage the company's desktop computers in Europe.

"I wouldn't be surprised if over the years to come the scope of the work is extended to include servers, mid-range systems, applications, maintenance, development and so forth," Sarissamlis told Reuters.

He added that IBM landed the deal because it has a relationship with Electrolux that spans decades.

"Basically, IBM has a long-standing relationship with Electrolux and they leveraged this relationship at the right point in time," Sarissamlis said.

Armonk, New York-based IBM said that Electrolux will pay IBM according to a variable pricing model in which the Stockholm-based company will pay on a per-user basis.

IBM will provide PCs, local area networks and its Lotus Notes e-mail program with an IT support staff using IBM's Tivoli network management system software.

Under the agreement, more than 100 Electrolux information technology workers will transfer to IBM, and service will commence Aug. 1, the companies said. (1 euro = $1.18)

One analyst put the value of the seven-year contract at 180 million to 220 million euros. While the contract calls for supporting 13,000 to 19,000 desktop PCs, that figure will likely increase, said Stratos Sarissamlis, vice president of technology research services for Meta group in Europe