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EBRD backs Georgia Capital’s US$ 150 million sustainability-linked bond

By Rezo Bitsadze

  • EBRD invests US$ 25 million in sustainability-linked bond issued by longstanding client
  • Bank’s investment to support the development of local capital markets in Georgia
  • Bond offering the largest in the country and the first of its kind in the Caucasus region

The European Bank for Reconstruction and Development (EBRD) is continuing to support capital market development in Georgia by participating in the first sustainability-linked bond (SLB) issuance in the Caucasus. The Bank is investing US$ 25 million in Georgia Capital’s (GCAP) US$150 million corporate bond, which is also the country’s largest ever corporate offering.

GCAP will primarily use the proceeds to refinance its existing Eurobonds, to enhance the robustness of its capital management and to boost its investment capabilities. As set out in the underlying SLB framework, the issue is also in line with GCAP’s net-zero ambitions; the company has committed to reducing CO2 emissions across its businesses by 20 percent by end 2027.

The issuance is dated 3 August 2023, with a five-year maturity and a fixed coupon of 8.50 per cent. It will be listed on the Georgian Stock Exchange and is in line with the International Capital Market Association’s SLB Principles and international standards of sustainable finance. The introduction of the new financial instrument to the local market has been supported by fellow international financial institutions.

The EBRD has a long-standing relationship with GCAP and has engaged with it and its subsidiaries on a number of occasions, including the company’s inaugural Eurobond issuance in 2018.

GCAP is a holding company for a diversified group of businesses operating in sectors including healthcare services, retail pharmacies, insurance and renewable energy. It is the only non-bank entity among the three Georgian companies listed on the London Stock Exchange.

The EBRD has invested almost €5 billion in Georgia to date through 286 projects, with 82 per cent of those in the private sector. The Bank’s key areas of investment include the financial sector, sustainable infrastructure and small and medium-sized enterprises.

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