Georgia Capital acquires Alaverdi Ltd

LONDON: Georgia Capital PLC announced that the Group’s wine business has acquired a 100% equity interest in Alaverdi Ltd.

Alaverdi owns 244 hectares of vineyards in the Kakheti region, the vast majority of which grow Georgia’s flagship red wine grapes, Saperavi.

The acquisition of Alaverdi also provides the Wine Business with access to 135 hectares of free land, available for immediate vineyard development.

The acquisition will triple the Wine Business’s production capacity from the current 9.4 million wine bottles to 28.4 million wine bottles per annum, which provides substantial relief in planned capital expenditures for the next few years.

Following the acquisition, the Wine Business will have 695 hectares of vineyards with additional 180 hectares of free land available for immediate vineyard development, in line with its target to reach a vineyard base of 1,000 hectares.

The Wine Business will consolidate the results of Alaverdi’s operations from the acquisition date and expects that the acquisition will provide a significant cost advantage to produce red wines with mostly self-harvested grapes. Georgia is in the top 20 global wine exporters and growing demand for Georgian wine over the last few years has resulted in increased grape prices.

The prices are expected to further increase as Georgia continues to tap new export markets, supported by the implementation of various free trade agreements, including those with China and the European Union.

Irakli Gilauri, Georgia Capital Chairman and CEO commented: “I am pleased to announce that our wine business continues to successfully progress towards its strategic priorities. The acquisition of Alaverdi is a truly compelling opportunity, which provides a clear and attractive value creation potential through cost synergies and the addition of a substantial base of high quality vineyards. Following the acquisition, the Wine Business will have three top class wineries across Kakheti’s three wine-making regions with significantly enhanced production capacity. This footprint should allow the Wine Business to access a bigger share of export markets, while also capitalising on the growing wine tourism in Georgia.”

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