Geosteel LLC successfully placed its first bond issue, in the amount of 15,000,000 USD, with the assistance of Galt & Taggart. This transaction is the first tranche of the planned total of up to USD 30,000,000. The issuance of the second tranche is planned for the second half of 2023.
The annual interest rate of the placed bonds is 9.00% (total accrued interest including taxes). The term of the bonds is 2 years and they will be repaid on April 21, 2025. It is worth noting that the demand of investors exceeded the volume of issued papers, which indicates a high level of confidence and positive future expectations towards the company on the part of investors.
The issuer plans to admit the issued bonds to the trading system and listing of the Georgian Stock Exchange. The company has also developed a Sustainability-Linked Bond Framework, which was given a "Second Party Opinion" by an independent evaluator, DNV Business Assurance Norway AS. The issuance of sustainability bonds shows Geosteel's commitment to the development of local human resources and the expansion of business processes through the use of environmentally friendly and safe procedures.
Geosteel is the first and only company operating in the heavy industry sector in Georgia, which issues bonds related to sustainability. The company plans using the proceeds received from the first issuance of the Bonds for financing Company’s maintenance and capital expenditures and refinancing its existing loans.
"I am pleased to announce that Geosteel has successfully issued the first $15 million tranche of sustainability bonds for a total planned value of $30 million. This is the first sustainability-related bond transaction on the Georgian capital market. We hope that the transaction will encourage the issuance of sustainable bonds in the country and will give additional motivation to other companies to start working on implementing high environmental, social and governance standards. We are very proud that we are the first in this regard and have contributed to the development of the heavy industry sector of Georgia. I would like to thank our placement agent – Galt & Taggart; and all other parties”, - stated Mr. Balakrishnan Sajiv, General Director at Geosteel.
"I am pleased that Galt & Taggart was actively involved in the successful implementation of such an unprecedented transaction, acting as a placement and calculation agent. The unique feature of the deal is worth noting, which involves placing the first sustainability-related bonds on the Georgian securities market. This transaction is the first joint placement between Galt & Taggart and Geosteel, and we expect many similar transactions in the future. I would like to thank and congratulate the entire Galt & Taggart team for another successful and exciting transaction. Galt & Taggart has been effectively cooperating with various representatives of the private and public sector as well as international financial institutions as a leading investment bank in the Georgian market for years," said Otar Sharikadze, Managing Director of Galt & Taggart.
