Page 64 - GEORptDec21

Georgian Capital to buy remaining 33% minority stake in Gefa pharma network by 2027
Georgian investment holding Georgian Capital announced that it will become the owner of a 100% stake in the pharmaceutical network Gefa (including GPC and Pharmadepo) by 2027.
According to the information published on the London Stock Exchange, the redemption of shares from businessmen will be carried out in six steps and it will be completed in 2027.
Following the initial pharmacy businesses purchases in 2016 and 2017, Georgian Healthcare Group (GHG), which is part of Georgian Capital, has held a 67% equity stake in the combined retail (pharmacy) business. It has a call option on the minority stake during the 12 months starting from January 2023. The remaining 33% minority stakeholders, Enrico Beridze and Mikheil Abramidze, who are also the managing partners of the retail business, have a put option for the minority stake also during the 12 months starting from January 2023.
Gefa is the leading pharma chain in Georgia and it operates about 300 pharmacies throughout the country. The company generated revenue of GEL679.5mn ($225mn) in 2020, which was 10.5% more than the previous year. In 2020, the company had a net profit of GEL32.5mn.
In the first half of 2021, GEFA's total revenue amounted to GEL372.8mn ($125mn), which is 16.9% more than the previous year.
9.2.4 Metal and mining corporate news
Locals in Georgia’s north-west Racha province protest against manganese
Locals in north-west Georgia’s village of Shkmeri protested on November 21 against the planned expansion of manganese mining works in the area.
According to Civil.ge, the protesters are demanding to void two 10-year mineral exploration and extraction licenses sold in an electronic auction in July by the National Agency of Mines, a state body under the Ministry of Economy. The activists cite a plethora of concerns, including fears that mining will destroy the surrounding landscape, negatively affect biodiversity, contaminate air and waters, with locals losing pastures, arable, land and grasslands.
“You cannot dig [this land] up... Our native land is of the people, it does not belong to any company,” Tsotne Gloveli, one of the organizers of the grassroots protest addressed the rally.
Speaking with Mautskebeli TV after his speech, the protest leader said organizers could not get the word about the rally to many, while many others were unable to arrive, leading to an outcome of only around 150 people. “But many more will come, the whole of Georgia will,” asserted Gloveli, pledging that protests will continue and intensify.
9.2.5 Utilities corporate news
Fitch affirms Georgia Global Utilities at B+, outlook stable
Fitch Ratings has affirmed Georgia Global Utilities JSC (GGU) Long-Term Issuer Default Rating (IDR) at 'B+'. The outlook is Stable. The affirmation reflects GGU's consolidated credit profile of its regulated water utility business (Georgian Water and Power LLC, GWP), and its higher-risk renewable electricity business, which is nevertheless supported by long-term power purchase agreements (PPAs). Overall size, asset quality, forex (FX) risk, the operating and regulatory environment, and high, albeit decreasing, leverage remain key rating constraints.
Fitch expects GGU's EBITDA margin in 2021 and 2022 to significantly improve toward 63%, from a low of 56% in 2020. The rating agency forecast GGU's profit to be supported by the higher-than-expected water tariff increases. The
64 GEORGIA Country Report December 2021 www.intellinews.com