Headline News

US to scrap charges against Agility unit

Published Date: July 29, 2010

KUWAIT: Kuwait's Agility, facing US fraud charges for overcharging the military, said the government wants to dismiss an indictment against one of its units, boosting shares in the logistics firm. Agility, formerly Public Warehousing Co KSC (PWC), was dropped from supplying food to the US Army in Iraq, Kuwait and Jordan after the charges surfaced, which pertain to $8.5 billion in contracts spanning 41 months.

The United States Attorney's Office in Atlanta moved to dismiss the indictment against Holdings, an Agility subsidiary," the firm said in a statement to the Dubai bourse on Wednesday. "While the prosecutors' motives for seeking this dismissal at this time are unknown ... this request for dismissal comes after motions filed by Holdings to discover the government's evidence against it.

In April, Agility DGS Holdings Inc, which is Agility's US subsidiary, pleaded not guilty to the sealed indictment. Kuwait has become a major logistics base for the American military since the US invasion of Iraq in 2003. "This is definitely good news for Agility, though they are not completely out of the woods yet," said an analyst in Kuwait who did not want to be named. "I think investors are so hungry for some sort of information on what's happening with the case, to give them some sort of direction, and
this is just that.

Agility has been suspended from bidding on any new contracts, and whether that decision is lifted is seen as key to the company's hopes for negotiations. Two companies are keen to grab the work, Kuwaiti logistics firm KGL and Dubai-based ANHAM FZCO LLC. Agility's shares, which were briefly suspended from trading on the Kuwaiti bourse yesterday pending news clarification, then resumed trading. - Reuters