Georgian Railways, with the help of partner investment banks, has successfully placed $ 500 million in green bonds on the London Stock Exchange.

Demand for 500 Million Georgian Railway Green Bonds Exceeds $ 4 Billion
Picture: JS Georgian Railway

The interest rate is set at 4% for a period of 7 years. The Georgian Railways refinanced Eurobonds issued in July 2012 with new bonds with an interest rate of 7.75%. This is reported by the railway magazine Railway Supply with reference to JS Georgian Railway.

Thanks to this deal, the company received a significant reduction in interest costs, in particular, the Georgian Railway will pay $ 20 million a year instead of about $ 40 million in interest. The money saved will further strengthen the company’s financial condition.

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Note that the bonds issued by the Georgian Railway have been assigned a green status. This is the first precedent in the Caucasus region when a transport company has issued such a security. Investors’ interest in the deal was quite high.

As a result of the work carried out by the Georgian Railway, international financial institutions such as ADB (Asian Development Bank) and EBRD (European Bank for Reconstruction and Development) were attracted, which acted as investors in the new issue. On the day the bonds were valued, the demand exceeded the nominal amount by 8 times.

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