A spokesman for Orange confirmed that the contract had been moved "following a robust tender selection process" and said that it was looking forward to working with Charterhouse from January 2010.

Charterhouse chief executive Gary Mahoney said the Hatfield-based print management firm was "very excited about the opportunity to work with Orange", which he described as "a sector leading brand" and "a good cultural fit for Charterhouse".

"It is a significant piece of business and the scale now gives Charterhouse the opportunity to challenge and win larger contracts," he added.

Meanwhile, Paperhat chief executive Tim Peppiatt said he was disappointed to lose the work, but thanked Orange for its support over the years.

He said: "I can confirm the Orange account is moving to Charterhouse after nearly 12 years with ourselves from January 2010.

"It's obviously very disappointing to lose £7m worth of business, especially on the back of £3.5m of new business wins, as it should have been a great end to a tough but rewarding year.

"We continue to have an excellent relationship with our Orange clients, many who have expressed their extreme disappointment at the final result. In fact the popular response has been 'gutted you won't be working with us next year'.

"Needless to say, we will be handing over the account in as professional manner as possible. I'd like to thank everyone at Orange for their support over the years and wish Charterhouse the best of luck for the future."