Monday, July 02, 2007
DynCorp Kuwaiti LOGCAP IV partner's shares up by 6.6 per cent
Contracts
(Gulf Daily News) - Kuwaiti logistics provider Agility said yesterday it was part of a group with US firm Dyncorp International which won a $50-billion (BD18-billion) deal from the US military. Agility shares rallied 6.6 per cent after the news. Agility said in a statement on the Kuwait bourse Web site it would provide various logistics, supply and warehousing services as part of the deal.
The contract would run 10 years, of which 9 were optional, and would have a value of $50bn for the whole period, it added. The deal, which included food and oil supply services, would be worth $5 billion for each year. Agility, which is diversifying its business and expanding abroad, said it could not currently determine its exact share of the deal.
The total deal also includes US firms KBR, a former unit of Halliburton, and Fluor Corporation with a combined potential value of up to $150 billion to provide services to the US military in the Middle East. Agility said on June 16 the US military had renewed a five-year deal worth $1.5 billion, extending the deal to its third consecutive year. The contract is up for yearly renewal.
The US government said on June 1 it had awarded Agility another supply and food deal worth up to $2.8 billion. Agility has said it was expanding in the Middle East, Africa or Eastern Europe to diversify its business and lower its exposure to US military deals, a key source of income.
Agility, previously known as Public Warehousing Co., has bought at least seven smaller rivals this year including New Zealand-based LEP International and Chinese freight company Guangzhou Runtang International Transport Company Limited.
Kuwait's money supply rose 15.6pc in the year to May, according to data on the Central Bank of Kuwait Website. M3, the broadest measured of money supply, rose to $60.36 billion. Money supply rose 18.3pc in the year to April.
The contract would run 10 years, of which 9 were optional, and would have a value of $50bn for the whole period, it added. The deal, which included food and oil supply services, would be worth $5 billion for each year. Agility, which is diversifying its business and expanding abroad, said it could not currently determine its exact share of the deal.
The total deal also includes US firms KBR, a former unit of Halliburton, and Fluor Corporation with a combined potential value of up to $150 billion to provide services to the US military in the Middle East. Agility said on June 16 the US military had renewed a five-year deal worth $1.5 billion, extending the deal to its third consecutive year. The contract is up for yearly renewal.
The US government said on June 1 it had awarded Agility another supply and food deal worth up to $2.8 billion. Agility has said it was expanding in the Middle East, Africa or Eastern Europe to diversify its business and lower its exposure to US military deals, a key source of income.
Agility, previously known as Public Warehousing Co., has bought at least seven smaller rivals this year including New Zealand-based LEP International and Chinese freight company Guangzhou Runtang International Transport Company Limited.
Kuwait's money supply rose 15.6pc in the year to May, according to data on the Central Bank of Kuwait Website. M3, the broadest measured of money supply, rose to $60.36 billion. Money supply rose 18.3pc in the year to April.
Labels: Agility Defense and Government Services, CH2M Hill, DynCorp International, Fluor Intercontinental, KBR, Kuwait, LOGCAP IV, Public Warehousing Co.
Thursday, June 28, 2007
LOGCAP IV awarded to Fluor, DynCorp and KBR
Contracts
(Washington Post) - The Army awarded a contract worth up to $150 billion to feed, house and provide other services to U.S. troops in Iraq, Afghanistan and Kuwait, spreading among three companies work that recently had been linked to a single, controversial contractor: Halliburton.
Fluor Intercontinental of Greenville, S.C., DynCorp International of Fort Worth and KBR of Houston were chosen from among a half-dozen competitors. Each company's part of the contract is worth up to $5 billion a year and can be extended for up to nine more years. The contract award was a particular victory for KBR, Halliburton's former contracting arm, after the firm was accused of misdeeds under the past contract, one contracting expert said.
"This is potentially the biggest battlefield services contract that any company is going to win for the remainder of this decade," Loren Thompson, chief operating officer of the Lexington Institute, a defense research organization in Arlington.
Known as the Logistics Civil Augmentation Program, or LOGCAP IV, the contract is considered one of the biggest deals in the contracting services industry. It has ballooned in value from $2 billion when it was first awarded in 1992 to $23 billion under the most recent LOGCAP III contract.
Two of the new winners have a history with the contract. KBR won the initial LOGCAP contract when support services were needed mainly in Bosnia. DynCorp won it in 1997 to do work in East Timor and the Philippines. And in 2001, it was again awarded to KBR to provide services in Afghanistan, Kuwait and, after the 2003 invasion, Iraq. Since then, the contract has come under scrutiny by members of Congress, and critics have alleged that KBR had an advantage in winning the 2001 contract because Vice President Cheney had been Halliburton's chief executive.
There have been other allegations of overcharging and poor record-keeping by KBR and lax oversight by the government. Government auditors turned up more than $1 billion in questionable costs. As of the end of May, KBR -- the largest single contractor in Iraq -- had been paid $19.7 billion for its work under the contract.
About 50,000 contractors work for KBR directly or as subcontractors to deliver services, and 500 government employees provide oversight of the logistics contract, according to Army officials.
Fluor Intercontinental of Greenville, S.C., DynCorp International of Fort Worth and KBR of Houston were chosen from among a half-dozen competitors. Each company's part of the contract is worth up to $5 billion a year and can be extended for up to nine more years. The contract award was a particular victory for KBR, Halliburton's former contracting arm, after the firm was accused of misdeeds under the past contract, one contracting expert said.
"This is potentially the biggest battlefield services contract that any company is going to win for the remainder of this decade," Loren Thompson, chief operating officer of the Lexington Institute, a defense research organization in Arlington.
Known as the Logistics Civil Augmentation Program, or LOGCAP IV, the contract is considered one of the biggest deals in the contracting services industry. It has ballooned in value from $2 billion when it was first awarded in 1992 to $23 billion under the most recent LOGCAP III contract.
Two of the new winners have a history with the contract. KBR won the initial LOGCAP contract when support services were needed mainly in Bosnia. DynCorp won it in 1997 to do work in East Timor and the Philippines. And in 2001, it was again awarded to KBR to provide services in Afghanistan, Kuwait and, after the 2003 invasion, Iraq. Since then, the contract has come under scrutiny by members of Congress, and critics have alleged that KBR had an advantage in winning the 2001 contract because Vice President Cheney had been Halliburton's chief executive.
There have been other allegations of overcharging and poor record-keeping by KBR and lax oversight by the government. Government auditors turned up more than $1 billion in questionable costs. As of the end of May, KBR -- the largest single contractor in Iraq -- had been paid $19.7 billion for its work under the contract.
About 50,000 contractors work for KBR directly or as subcontractors to deliver services, and 500 government employees provide oversight of the logistics contract, according to Army officials.
Last year, the Army decided to award the logistics contract to more than one company after concerns were raised about a lack of competition in giving such a large contract to one company. Under the new contract, the three companies will have to compete for each individual task order.
Labels: DynCorp International, Fluor Intercontinental, Halliburton, KBR, LOGCAP IV, Logistics Civil Augmentation Program
