United (Energy) Distribution Company (UDC) Management Contract

concluded

On May 8, 2003, PA Government Services Inc. (PA), part of the PA Consulting Group, signed an interim management contract with the Republic of Georgia and with the management of the United Distribution Company, the state-owned electricity distribution utility in Georgia. The United Distribution Company (UDC) was formed in 2002, as an amalgamation of several regional electricity companies. It had about 660,000 customers and a service area covering 70% of the country. The company was in very serious difficulty, characterized by dismal financial performance, huge payables, inadequate business systems, all of which combined made the UDC unable to provide reliable electricity supplies to its customers. USAID contracted PA Consulting for the project and agreed to finance the interim management contract as part of the broader U.S. Government's foreign assistance program for Georgia and in response to the urgent request of the Government of Georgia. PA Consulting Group was a leading management, systems and technology consulting firm operating world-wide from over 40 offices in more than 20 countries. The contract provided to PA the right to manage the United Distribution Company for a period of approximately 18 months, with funding to be provided by the US Agency for International Development (USAID). PA Consulting was to step in with an 18-month interim management contract intended to give the government time to organize a tender and appoint a long-term private management contractor to take over the management of the UDC for an additional period of five years. The tender did not take place as was anticipated and in 2004, PA's management contract was extended for additional two years. In February 2007, the Government sold 100% stake in the United (Energy) Distribution Company to Czech company EnergoPro (ID 4785). None None