New company to take over Agility-U.S. contract

New company to take over Agility-U.S. contract    The U.S. Defense Logistics Agency on Thursday named a new contractor for food and beverage support to U.S. forces in Iraq, Kuwait and Jordan, to take over by December for embattled defense logistics giant Agility.
   The new company, Dubai-based Anham, has secured a six-year contract that could be worth up to $6.4 billion, said DLA spokesman Dennis Gauci.
   'The contract is for six years: an 18-month base period and four option periods,' Gauci said in an e-mail to American Shipper. 'Option periods one, two and three are for one year each, while option period four is for 18 months. The maximum potential value of the contract is about $6.4 billion if all options are exercised. However, we expect that the actual dollar value over the life of the contract — again if all options are exercised — will be about $2.1 billion.'
   Anham would replace Agility, which has been embroiled in a fraud case with the U.S. government since last fall over charges the logistics company overbilled the government for millions of dollars on food supply contracts to U.S. troops in the Middle East.
   On Thursday Kuwait-based Agility told that country's stock exchange that another company would be succeeding it as U.S. military food supplier. Agility didn't name the new company but said it would continue to supply U.S. troops for six months 'to guarantee continuity of supplies.”
   Agility, formerly known as Public Warehousing Co., built its reputation as the largest defense logistics contractor to the U.S. military. The company also has a growing commercial division and is also the biggest Middle East-based logistics company.
   Earlier this week, the U.S. government expanded its charges against Agility to two of its subsidiaries, DGS Holdings and DGS KSCc. The company is in negotiations with the U.S. government over a settlement on the fraud charges. Various outcomes have been mooted, including a multimillion-dollar fine and a suspension from participating in future Department of Defense contracts.
   Agility's contract with the U.S. government expires in December. Gauci said 'companies who are suspended from doing business with the U.S. federal government are ineligible to compete for future contracts for as long as they are suspended.'
   He said four companies bid on the food supply contract.
   According to a report Friday in the Washington Post, Anham is a collaboration of three multinational firms.
   'Anham’s chairman and chief operating officer is Abul Huda Farouki, a northern Virginia resident and well-known social figure in Washington,' the report said. 'His HII-Finance Corp., based in Fairfax County, joined with two giant Middle East conglomerates to form Anham. One is Saudi-based Arab Supply and Trading, and the other is the Munir Sukhtian Group of Cos., a Jordanian investment and operating entity.' ' Eric Johnson