...

Silknet JSC to issue Georgian depositary notes

Business Materials 18 November 2020 09:17 (UTC +04:00)
Silknet JSC to issue Georgian depositary notes

BAKU, Azerbaijan, Nov.17

By Tamilla Mammadova – Trend:

Silknet JSC, a telecommunication company in Georgia, is now issuing Georgian Depositary Notes, Trend reports via Georgian media.

According to the CEO of Silk Road Bank, Ilia Enukashvili, 'Depositary Notes' is a freshly coined term because they are not commonly used. This is a term for when a credit instrument is transported into a different jurisdiction and a different mechanism of investing in securities.

"Silknet has successfully placed 200 million Eurobonds about a year and a half ago, and the natural demand for such an issue was from foreign investors. Usually, local demand is an essential part of any issuance from an emerging market. Unfortunately, Georgia has a sketchy record of having capital markets and investors who want to buy securities. We understood that to cultivate the demand for future issuances and the development of the capital markets and the demand for other securities that the company may issue in the future, it is important to create instruments that will allow Georgian retail investors to get exposure to Georgian companies," he said.

As Ilia Enukashvili said, Eurobonds have a very peculiar feature where a minimum investment amount is two hundred thousand dollars, which is by far not accessible to many Georgian retail investors.

"Even the high net worth individuals in Georgia may find it difficult to invest such amounts of money. That's why we decided to find an instrument that would allow a much lower threshold for investing. We found the depository notes. We developed essentially new security that mimics most of the existing euro bonds' rights and obligations and provides indirect means of investing in the Eurobond," he said.

---

Follow the author on Twitter: @Mila6197935

Tags:
Latest

Latest