MAY 5 2016 (The Conway Bulletin) – London-listed Georgia Healthcare Group said it completed the acquisition of GPC for $14m, one of Georgia’s largest retail and wholesale pharmacy chains. Following an agreement signed earlier in March, GHG will now own 100% of GPC. GPC controls 15% of the pharmaceutical market in Georgia.
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(News report from Issue No. 279, published on May 6 2016)
APRIL 30 2016 (The Conway Bulletin) – State-owned KMG EP and China’s CEFC energy company finalised their earlier agreement to form a joint venture that will take over the business of KMG International, formerly Rompetrol. In December, CEFC bought a 51% stake in KMG International for $680m, KMG EP revealed this week.
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(News report from Issue No. 279, published on May 6 2016)
APRIL 29 2016 (The Conway Bulletin) – Grigory Marchenko, former chief of Kazakhstan’s Central Bank, bought an 8.3% stake in AGBank, a private bank in Azerbaijan. Chingiz Asadullayev, the bank’s chairman, increased his stake to 31.7%, up from 23.3%. The World Bank’s International Financial Corporation decreased its stake from 17.5% to 4.3%. Mr Marchenko left his post at Kazakhstan’s Central Bank in October 2013. Since leaving the role, Mr Marchenko has kept a low profile.
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(News report from Issue No. 279, published on May 6 2016)
APRIL 29 2016 (The Conway Bulletin) – International ratings agency Moody’s said that the proportion of loans deemed non-performing in Azerbaijan had reached 20%, a sign of the country’s poor economic health.
Moody’s said that data clearly shows the growth of non-performing loans in Azerbaijan. At the end of 2014, the proportion of non-performing loans in Azerbaijan had been 4.5%. This rose to 9.1% by the end of the third quarter of 2015 and has doubled, again, in the past six months.
Non-performing loans are credits that banks have been unable to collect for over 90 days. Analysts deem this timeframe a problem because when a loan is not repaid within three months it is likely that it will not be repaid at all.
Moody’s downgraded Azerbaijan’s economy, giving it a negative outlook and predicting problems collecting outstanding loans.
“The manat devaluation triggered a flight out of local currency deposits, led to a rise in banks’ problem loans, and eroded capital buffers,” it said in a statement.
Azerbaijan’s economy is heavily dependent on oil and gas which has collapsed in value since August 2014. The Central Bank devalued the manat currency twice last year. It ended the year at half the value it had started 2015 at.
Moody’s said this has had a negative impact on both economic activity and the banking sector.
“Azerbaijan’s economic growth outlook remains weak,” Moody’s said. “Moody’s recently revised its 2016 growth forecast for Azerbaijan, expecting real GDP to shrink by 3.3%, compared to a previous forecast contraction of 0.7%, reflecting its expectation of a contraction in both the oil/gas and non-oil/gas GDP sectors.”
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(News report from Issue No. 279, published on May 6 2016)
MAY 4 2016 (The Conway Bulletin) – Canadian miner Centerra Gold, owner of the Kumtor gold mine in Kyrgyzstan, once again said that it had not broken any rules in 2013 when it made a dividend payment . It was responding to a raid by police on the Kumtor office in Bishkek. Police were apparently sent to the Kumtor office specifically to search for any evidence of financial crime. Kyrgyzstan wants to increase its stake in Kumtor.
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(News report from Issue No. 279, published on May 6 2016)
APRIL 29 2016 (The Conway Bulletin) – Russian gold miner Polymetal said that its Lichkvaz project in Armenia holds 18.1 tonnes of gold, up 17% from a previous assessment. Last November, Polymetal bought the 75% stake it didn’t own in Lichkvaz for $9.7m, gaining full ownership in the project. Outside Russia, Polymetal operates in Armenia and Kazakhstan.
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(News report from Issue No. 279, published on May 6 2016)
MAY 3 2016 (The Conway Bulletin) – KEGOC, a mainly state-owned electricity distributor in Kazakhstan, said it will not pay out dividends for 2015, due to the company’s poor financial performance last year. In 2015, KEGOC posted a loss of 7.8b tenge ($23.4m). KEGOC was one of the best performers in the Kazakh Stock Exchange last year, with its shares gaining 47%. The government sold a chunk of KEGOC at the end of 2014, as part of its so-called People’s IPO.
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(News report from Issue No. 279, published on May 6 2016)
MAY 2 2016 (The Conway Bulletin) – Kazakhstan Temir Zholy, the country’s railway operator, issued bonds for 50b tenge ($150m) with a 10-year maturity, in what has been described as the largest issue of debt in Kazakhstan in 2016. Halyk Finance, part of Halyk Bank, the second-largest lender in Kazakhstan, brokered the deal in the Kazakh Stock Exchange.
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(News report from Issue No. 279, published on May 6 2016)
MAY 3 2016 (The Conway Bulletin) – State-owned Uzbekistan Airways said it transported 535,600 passengers in the first quarter of 2016, a 6.8% reduction compared to the same period last year. The company also said it reduced the number of flights by 9.8% to 5,007. The biggest cut has been to Uzbekistan Airways’ internal routes, a sign, perhaps, of a weaker domestic economy.
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(News report from Issue No. 279, published on May 6 2016)
MAY 3 2016 (The Conway Bulletin) – Kazakhstan’s flagship carrier Air Astana said it has postponed the launch of its new route to Iran by a month. The company did not give an explanation on why it had delayed the launch of the route, which had been a much heralded link to Iran. Kazakhstan has been keen to welcome Iran back into the international community since the lifting of most sanctions earlier this year. Flights linking Almaty and Tehran should now start on June 30.
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(News report from Issue No. 279, published on May 6 2016)