UPDATE 1-Agility says suspended, not banned, from US

* New U.S. contracts "temporarily suspended", not "debarred"

* Agility says existing U.S. contracts not affected (Adds detail, background)

DUBAI Nov 18 (Reuters) - Agility (AGLT.KW), a Kuwaiti firm supplying food to U.S. soldiers in Iraq and Kuwait, said it had been temporarily suspended, but not debarred, from new U.S. government contracts pending the outcome of a grand jury indictment on allegations that it overcharged.

Agility was indicted on Monday, under its previous name, Public Warehousing Company, K.S.C. (PWC). The firm is accused of overcharging the U.S. Army to the tune of $60 million over a 41- month period, on $8.5 billion worth of food supply contracts. [ID:nN16518906]

"The Defense Logistics Agency (DLA) has temporarily suspended PWC from being awarded any new business until it determines that the company is presently responsible. The company has not been debarred from U.S. government contracting," Agility said in a statement published by the Dubai bourse.

The statement, Agility said, corrects its own statement made one day earlier saying it had been debarred from new U.S. contract awards.

No decision on whether to debar the company would take place until all the facts of the case have been reviewed, Agility said.

Agility, the principle food supplier to the U.S. military in Kuwait and Iraq, said previously that the indictment and complaint were without merit and would not impact current contracts with the U.S. government.

Shares in Agility fell more than 8 percent on the Kuwaiti bourse on Tuesday in the wake of the news.

Agility receives 37 percent of its revenue through logistics support to the U.S. government and other agencies, according to a recent report from Goldman Sachs.

It competes with regional firm Aramex ARMX.DU and global players such as DHL (DPWGn.DE), UPS (UPS.N), FedEx (FDX.N) and TNT TNT.AS. (Reporting by Thomas Atkins; Editing by John Irish)