Georgian Competition and Consumer Protection Agency (GCCA) has agreed to buy 100% shares of Georgian Beer and Beverage Holding Ltd., Global Beer Georgia Ltd., Genuine Brewing Company Ltd., Global Coffee Georgia Ltd., and Georgian Distribution and Logistics Ltd.
GCCA evaluated the import market of beer, non-alcoholic beverages and coffee. In 2023 75 companies were operating in the beer market, the market volume was 131 709 495 liters, the market concentration index (HHI) was 2273.
Market Concentration Index is slightly above the maximum index of a moderately concentrated market, but there are larger companies than the target entity and the market is fairly balanced and overall competitive.
In 2023 there were 215 companies in the non-alcoholic beverages market, the market volume was 464 757 669 liters, and the market concentration index (HHI) was 2 590. The market is highly concentrated, but the corresponding index is not determined by the market condition of the people participating in the concentration.
LLC “Georgian Distribution and Logistics” operates at the level of distribution services. The distribution services market volume in 2023 was 7 431 011 772 GEL, while the Market Concentration Index (HHI) was 400 units, which is an indicator of a low-concentrated market.
LLC “New Coffee Company” represents a coffee importer company. 200 economic agents were operating in the coffee import market, the total market volume was 6,625 788 kilograms, and the Market Concentration Index (HHI) was equal to 1721 units, indicating that the market was moderately concentrated.
The agency’s assessment of the concentration, also took into account the factor that the owner of 100% shares of these companies is one entity, which means that they were already merging into one group as it is, and their grouping will not be the result of the concentration. Thus far, there is no risk of coordinated and uncoordinated effects due to their new grouping. At the same time, there is no change in concentration index in any market, because Georgian Beer and Beverage Holding Ltd. does not operate in any relevant market, and its control companies do not operate in the Georgian market.
Therefore, considering the market analysis carried out by the agency, the structure of assessed markets and the market shares of the participants of the concentration, the concentration will not have a significant impact on the competitive environment.
For information, LLC “Georgian Beer and Beverage Holding” is a subsidiary of Royal Swinkels registered in the Netherlands in Georgia. Royal Swinkels is one of the largest beer producers in the European Union. In the company’s portfolio, there is a familiar brand for the Georgian market, “Bavaria.”
Global Beer Georgia LLC, a member of the Georgia Capital Group, is on its own the official producer and distributor of Kazbegi, Aisi, Heineken, Amstel, Krusovice and other international brands in Georgia. And LLC “Genuine Brewing Company” produces the first Georgian craft beer – “Black Lion”. Georgia Capital will receive at least $ 63 million in exchange for the control package.
