NRMA sell-down casts IT shadow

Relies on IAG systems.

NRMA Motoring insists the provision of its IT services are not at risk, despite reports of growing tensions between the company and its offspring Insurance Australia Group (IAG), which shares the NRMA brand name and provides it a number of crucial IT services.

NRMA Motoring spun off its insurance arm in 2000, the latter rebranding as IAG in 2002.

According to a report in the Sydney Morning Herald, a complex series of agreements between the two firms includes a deal under which NRMA Motoring pays IAG up to $10 million a year to use IAG's branch network, IT systems, call centres and back-office assets.

This arrangement – and all others between the two firms – is reportedly in doubt after NRMA Motoring sold down almost half of its IAG holding in secret.

The Sydney Morning Herald reported Monday that the sell-down was aimed at forcing a restructure to the way IAG and NRMA Motoring work together.

Spokesmen for both companies have disputed reports of a boardroom rupture over the share sell-down.

An NRMA spokesman told iTnews the motoring services company's relationship with IAG "worked quite well".

An IAG spokesman similarly said the two organisations were "committed to a positive and mutually-beneficial relationship.

"There's a strong alignment of interests, contrary to any allegations [otherwise]," the spokesman said.

IAG was reported to have been scoping IT outsourcing arrangements with a range of IT services firms in April.

The firm had previously outsourced to IBM GSA deal in a deal that expired in 2003.