Depositary bank chosen for record Georgian IPO

BNY Mellon to act as depositary bank for TBC Bank’s $240 mn IPO

Investment bank BNY Mellon has been appointed to oversee the IPO of Georgian financial services firm TBC Bank, in what is expected to be the country’s largest ever IPO.

Though TBC Bank’s ordinary shares are not listed, BNY Mellon will give foreign investors the option to invest in the bank via a global DR (GDR) program, with each receipt representing shares and trades on the London Stock Exchange.

The Georgian bank has been valued at around $640 mn, with DRs set to be traded in London for $13 apiece. In a statement released in June, the bank confirmed it expected the IPO to be worth almost $240 mn, excluding some shares that would be offered as part of an over-allotment option.

Vakhtang Butskhrikidze, TBC Bank’s CEO, says that after an encouraging response he is ‘looking forward to our future life’ on an international stage.

‘It is gratifying to see so many prestigious international investors recognizing TBC Bank’s outstanding track record and supporting our growth strategy, while also demonstrating their belief in the fundamental strength and stability of the Georgian economy,’ Butskhrikidze continues. ‘We are proud to welcome our new shareholders and look forward to implementing our continued expansion in the retail, small and medium-sized enterprises and microfinance sectors of our market.’

Proceeds from the deal are set to go to a group of selling shareholders that include the World Bank’s International Finance Corporation, the European Bank for Reconstruction and Development, Germany’s DEG investment corporation, JPMorgan and investment manager Ashmore. TBC Bank itself hopes to raise around $96 mn for growing its business from the sale of new shares.

BNY Mellon already acts as a depositary bank for all such programs in Georgia, alongside more than 2,800 other ADRs and GDRs. Christopher Kearns, the CEO of BNY Mellon’s DR business, says he has high hopes for what is only the country’s second international IPO. ‘TBC Bank’s diverse investor base demonstrates positive investor sentiment in Georgia and we hope this deal will provide a template for other Georgian companies that want to raise capital,’ he concludes.

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