JSC Silknet, one of the leading companies in Georgia, offering wide range of telecommunications products including Internet, TV, fixed telephone services and business telecommunications services, has purchased Geocell, the second-largest mobile telecommunications operator in the country.
Georgian Technological Giant Silknet Buys GSM Operator Geocell for $153m
By Tea Mariamidze
Tuesday, January 30
After the merger of two technological giants, it is believed that the largest full-spectrum telecommunication company will be formed, providing a wider choice of new products and services to Georgian consumers.
“The deal between Silknet and Geocell companies amounted to $153 million,” Founder of Silk Road Group and Chairman of the Silknet Supervisory Board, Giorgi Ramishvili said at the press-conference on January 29.
The conference was held with the presence of Lekso Topuria, member of Silk Road Group and Silknet supervisory board, Badri Japaridze, founder of TBC Bank and Vakhtang Butskhrikidze, Director General of TBC Bank.
It was noted that the deal was made after reaching an agreement with Geocell’s shareholders, Telia Company (STO:TELIA) and Turkcell (NYSE: TKC, IST: TCELL).
The $153 million acquisition will be financed through a combination of debt – a syndicated loan arranged by TBC Bank with other Georgian and regional banks – and equity.
Silknet said the transaction creates a major convergent telecom operator in Georgia, combining the assets of the country’s largest fixed-line company, Silknet, with the mobile telecommunication activities of Geocell.
“This transaction allows us to create an integrated telecommunications operator, combining fixed line and mobile technologies. The larger scale will provide the company with superior access to international capital markets, further ensuring continuous investment in new technologies. Our subscribers will greatly benefit from these endeavors, as we strive to provide Georgian consumers with even better products, services and content,” said Giorgi Ramishvili, adding he expects the deal will strengthen the development of Georgia’s digital infrastructure.
Subject to approval of the local regulatory authorities in Georgia, the acquisition is expected to be completed in the second quarter 2018.
The press-conference was also attended by Georgia’s Finance Minister, Mamuka Bakhtadze.
In 2017 Silknet achieved 41% of Internet market share in Georgia. 30% of Georgian families enjoy Silknet’s cutting-edge IPTV service with its exclusive content. Company holds 48% of the fixed telephone market as well.
After the merger of two companies is concluded, it may be transformed into the largest telecommunication company in Georgia.