Britain's Ministry of Defense has given Babcock International a 10-year contract for maintenance of the Royal Army's land vehicles.

The value of the award is more than $1.3 billion but could more than double in value, if the services to be provided are broadened in scope.

The contract for the maintenance, repair and storage of the vehicles is part of the sale by the ministry of its Defense Support Group business to Babcock for about $211 million as a cost-saving measure.

Employees of DSG, which previously performed the vehicle maintenance work, are to become Babcock employees. Babcock will lead a DSG business improvement program over several years to optimize its business performance.

The maintenance services and DSG transformation begins in April.

"This contract is excellent news and puts DSG on a sustainable long-term footing to support maintenance and availability of land platforms for the army, in a similar manner to existing contracts for support of platforms for the other services," said Minister for Defense Equipment, Support and Technology Philip Dunne.

"Babcock will provide DSG with key engineering and fleet management expertise, which it has built up over 15 years of working with the Army. DSG will also gain the potential to provide vehicle maintenance to other existing heavy vehicle customers which it is unable to do while owned by the MOD."