Page 52 - GEORptOct22

8.5 Fixed income
8.5.1 Fixed income - bond news
Companies registered in Georgia given right to participate in EU tenders
BSTDB announces $45mn investment in ENERGO-PRO bond issue
Georgia’s telco Silknet successfully refinances $200mn Eurobond
Any business registered in Georgia is now able to participate in tenders on the purchase of goods held by the EU’s 27 member states, the State Procurement Agency of Georgia announced on July 25.
"For companies registered in our country, the European Union's central authorities have opened the purchase market. Until this day, Georgian companies faced a legal restriction on participating in European tenders," said the agency.
Georgian Economy Minister Levan Davitashvili said that the change was “the result of Georgia's complete fulfilment... of the obligation defined by the Association Agenda... This is an important step forward in Georgia's integration into the European economic area”.
The procurement agency added that each year around 250,000 purchasing organisations in Europe buy goods and services for a total amount of around €2 trillion.
The Black Sea Trade and Development Bank (BSTDB) said on February 4 it is investing $45mn as an anchor investor in a bond issuance by ENERGO-PRO a.s.
Czechia-based ENERGO-PRO has operations in Bulgaria, Georgia and Turkey, and the bond will be used for projects that include investments to raise the reliability of power grids in Bulgaria and Georgia.
The total size of ENERGO-PRO’s bond issuance is $435mn. Its investment programme "envisages capital expenditures in particular in rehabilitation and modernisation of the electricity network in Bulgaria and Georgia for households and corporate clients, as well as connecting more clients to electricity network,” according to the BSTDB press release.
The development added that it will contribute to improving ENERGO-PRO’s environmental and social performance by strengthening its environmental and social management system and expanding it to more sites in the three Black Sea countries, as well as by developing comprehensive stockholder engagement plans, and increasing adaptability of its power generation to climate change.
Previously, the BSTDB was an anchor investor in the bond issued by ENERGO-PRO’s subsidiary ENERGO-Pro Varna AD in Bulgaria in 2016. The BSTDB supported the company again as an anchor investor in ENERGO-PRO’s debut Eurobond issue the following year.
Georgia's leading telecommunications company Silknet has successfully raised $300mn in a new bond issue.
Silknet’s previous $200mn Eurobond, issued in 2019, is callable from 2 April 2022.
The move follows an improved outlook from rating agency Moody's and saw a substantial reduction in the coupon rate to 8.375% from 11%, with a comparable yield to other major telecoms operators in the region, such as Turk Telekom, demonstrating the company's strong investment prospects.
The new eurobond will put the company into JP Morgan's CEMBI Index, one of the leading listings of emerging market bonds, for the very first time.
Some 40% of the subscriptions come from the UK, 20% from the US, with 40% coming from Switzerland, European countries and Georgia.
52 GEORGIA Country Report October 2022 www.intellinews.com