Telefónica, the parent company of O2 UK, has extended its finance and accounting business process outsourcing (BPO) agreement with Steria until 2014.

According to Steria, the contract extension aims to reduce costs, improve performance and drive innovation within O2's UK operations. The deal will look to secure O2 cost savings on its finance and accounting transaction processing and will be subject to external benchmarking and best practice review.

The deal builds upon an existing five year relationship between the two businesses and is due to be implemented from April next year.