Page 51 - GEORptOct21

8.5 Fixed income
8.5.1 Fixed income - bond news
Galt & Taggart places Georgian Leasing Company bonds worth $12mn and $3mn
Fitch confirms final rating for Georgia Railway “green bond”
Investment bank Galt & Taggart has successfully placed 2-year bonds of Georgian Leasing Company worth $12mn, it was reported on July 14. Additionally, for the first time, EUR-denominated bonds of €3mn with a 2-year maturity were placed in Georgia.
These are the 6th and 7th issuances carried out by Georgian Leasing Company. The transactions amid pandemic uncertainties prove that Georgian Leasing Company is a stable company and foreign investors trust it, according to Galt & Taggart.
The annual fixed rate on the USD-denominated bonds is 5.75%, while the annual fixed interest rate for the EUR-denominated bonds is 4.75%. Both securities will mature in two years, on July 12, 2023. Noteworthy was that investor demand exceeded the issuance volume. Both placements were carried out by G&T.
“We are pleased that Georgian Leasing Company has carried out the new successful placement of bonds on the domestic market. The demand for the mentioned securities has exceeded our expectations and indeed, this fact proves the creditworthiness of our company and the high professionalism of Galt&Taggart. We are also proud that our cooperation has continued for many years,” Georgian Leasing Company director general Eldar Akhvlediani noted. “I am happy to hail Galt & Taggart’s role in the successful placement of Georgian Leasing Company’s bonds. This is an unprecedented placement with the low coupon rate on USD-denominated bonds and the first placement of EUR-denominated bonds. I congratulate the team of Galt & Taggart on how it has become Georgia’s leading supplier of investment-banking services thanks to its experience and professionalism,” Galt & Taggart managing director Otar Sharikadze said.
Fitch Ratings announced on June 16 that it has assigned Georgian Railway's $500mn senior unsecured fixed coupon (4.00%) green eurobond due 17 June 2028 a final long-term rating of BB-.
Global Capital announced on June 10 a benchmark offering range of 4.375%-4.5% for the 7-year issue.
The assignment of a final instrument rating is contingent on the successful placement of the eurobond and the completion of tender offer with exit consent for the company's existing $500mn 2022 notes, the rating agency said on May 26 when assigning the provisional rating to the bond. This implies that the prerequisites (the exit consent and the issue of the new bond) were met - although Georgian Railway has not yet announced anything in this regard to the London Stock Exchange where both the maturing (2022) and the new bonds are (or will be) listed.
However, Georgian Railway published on June 16 a Prospectus document related to the new bond, dated June 15.
“The final rating was assigned following the receipt of final documents conforming to information already received and details regarding the amount, coupon rate, and maturity,” Fitch stated, along with the confirmation of the final rating for the new bond.
The final rating is the same as the expected rating assigned on 26 May 2021. Last November, Fitch affirmed Georgian Railways' Long-Term Foreign- and Local-Currency Issuer Default Ratings (IDRs) at 'BB-' with a negative outlook.
51 GEORGIA Country Report October 2021 www.intellinews.com