Ex-CIPFA company makes FTSE 100 debut next week

Reflecting the massive growth of technology and telecom stocks over the last year, household names like Thames Water, Imperial Tobacco and Scottish & Newcastle are set poised to give way to upstarts like Freeserve – a company that didn’t even exist a year ago.

But it is not all household names that will leap into the index as a result of the quarterly review of stocks. Capita Group should also make its debut.

Little more than a decade ago, Capita was an arm of CIPFA, the public sector institute. Launched as a two-man operation in 1984 within CIPFA, it was bought out by management three years later.

Rod Aldridge, one of the founders and now the company’s chairman, is worth a staggering £39m, according to the Sunday Times rich list. By that measure he is Britain’s 659th richest person.

With institutional funds that track the FTSE 100 index forced to take a greater stake in Capita as a result of its promotion, his ranking is only likely to be enhanced.

Probably the most crucial point in Capita’s brief history was then chancellor Norman Lamont’s 1992 Autumn Statement. Lamont unveiled plans to ‘enable the public and private sectors to work more closely together’, expanding the already growing outsourcing market in one fell swoop.

But Capita no longer relies on the public sector for work. With 100 large-scale contracts, it now numbers the likes of British Airways and American Express among its clients. And last month it signed an internet venture with Microsoft. Monday will prove another key date in the company’s history.

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