The Pentagon awarded German industrial giant Siemens (NASDAQOTH:SIEGY) a mammoth $1.9-billion contract Wednesday in its fourth option-year extension of a contract originally awarded back in 2009 ... and back when its estimated "maximum" value was supposed to be $267 million.
The contract in question, designated a fixed-price with economic-price-adjustment, indefinite-delivery/indefinite-quantity (IDIQ) contract, covers the purchase of up to an additional $1,871,764,738 worth of "radiology systems, subsystems, accessories, service, manual, and repair/parts" for use at Army, Navy, Air Force, and Marine Corps locations, as well as by unspecified "federal civilian agencies." The fourth option year expires March 30, 2014.
Because this contract is designated "IDIQ," actual purchases will be billed as good when ordered and delivered, and the total amount spent may not (or may) reach the stated maximum value.
Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.