updated 6/2/2004 3:52:03 PM ET 2004-06-02T19:52:03

Williams Cos. has agreed to ship about 460 accounting, finance, human resources and information technology jobs to IBM Corp. in a $320 million outsourcing agreement announced Tuesday. Williams' shares hit a 52-week high.

The 7 1/2-year deal is expected to begin July 1 when roughly 380 Williams employees in Tulsa, 70 in Houston and 10 in Salt Lake City are offered jobs at IBM _ a move Williams expects will save as much as $10 million each year.

"This is a big, and difficult, step for our company and all of us as individuals," Steve Malcolm, Williams' chairman, president and chief executive wrote in a memo to employees. "It's also a critical step in satisfying our need to quickly align our support costs with our smaller, more focused business operations."

Williams has sold more than $8 billion in assets _ including three major pipelines and two refineries _ since 2002 to improve its finances after its faltering energy trading business nearly led to bankruptcy.

The Tulsa-based company has refocused its business on finding, producing, transporting and processing natural gas amid a downturn in the energy sector following Enron Corp's collapse.

Williams shares closed up 32 cents, or 2.7 percent, at $12.23 on the New York Stock Exchange, topping the previous 52-week high of $11.99. Shares of Armonk, N.Y.-based IBM fell 47 cents to $88.12.

Some of the outsourced workers will be employed in IBM's Tulsa center, while others will be offered jobs elsewhere, said Maureen Power, IBM's vice president of business transformation and outsourcing. The details have not been worked out, she said.

"Our offers, should they accept, will be at comparable pay and comparable benefits," Power said in an interview with The Associated Press.

Separately, IBM announced it will offer jobs to 65 accounting workers from Houston-based Marathon Oil Corp., employing them at IBM centers in Houston, Findlay, Ohio, or Tulsa, where IBM currently employs almost 1,000 workers performing clients' finance and administrative duties.

After the outsourcing, Williams will employ about 1,100 workers in Tulsa, down from about 2,400 two years ago. Through asset sales, layoffs and the deal with IBM, Williams will have reduced its work force to about 4,500 from 12,400.

Copyright 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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