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Conti International to Quit Anaklia Development Consortium

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The U.S.-based Conti International, one of the main partners of Anaklia deep sea port project, has decided to quit the Anaklia Development Consortium. The latter has already confirmed the information.

The reasons of Conti International’s decision, however, remain unclear. Commenting on the issue, Levan Akhvlediani, director general of the Consortium, told reporters on August 15 that Conti International has not made the decision on leaving the Consortium “today or yesterday” and that “talks about it were underway for a certain period of time.” He also noted that “this is not a pleasant fact, but nothing has happened that may critically harm the project.”

Akhvlediani denied expert assessments, according to which Conti International’s decision means that the West will distance itself from the project, saying that the Consortium will further develop the project and bring it to the end. He also noted that the financial institutions and the government have yet to reach an agreement on commercial risk insurance, adding that the Consortium has an alternative option, which will be thoroughly discussed in September.

News about Conti International’s decision to quit the Anaklia Development Consortium emerged after accentnews.ge, an online edition, reported on August 15 quoting an unidentified source that lack of agreement between the government and the international financial institutions prompted Conti International to make this decision.

Background

The Anaklia Development Consortium was founded in 2014 and its 99.99% is owned by JSC Anaklia Holding, while 0.01% is the state property. Conti International owns a 42% share in Anaklia Holding; moreover, its founder, Kurt G. Conti served as the deputy chairman of the Holding’s supervisory board till December 2018.

The Anaklia Development Consortium (ADC), a joint venture of Conti International and TBC Holding founded by Mamuka Khazaradze, former chairman of TBC Bank’s supervisory board, was awarded the contract to build and operate the deep sea port in 2016; marine engineering works commenced in December 2017 and the first phase of construction ended last autumn. The government prolonged the term of attracting financial resources by the Anaklia Development Consortium till December 2019.

Developments around TBC Bank, including money-laundering allegations against its founder, Mamuka Khazaradze, earlier this year have brought the fate of the Anaklia project into question. Although the government officials have said the project would not be imperiled, the Anaklia Development Consortium claimed lack of clarity around TBC would impede finalizing of the pending agreements on funding with foreign lenders.

Mamuka Khazaradze and his deputy, Badri Japaridze announced about their plans to quit Anaklia Development Consortium’s Supervisory Board on July 26, after Tbilisi City Court ruled that the founder and former Board Chair of the TBC Bank, Mamuka Khazaradze and his Deputy Badri Japaridze had to post a GEL 700,000 bail each after being charged in a money laundering lawsuit.

Khazaradze and Japaridze linked the investigation to the attempts to distance them from the Anaklia deep sea port project; the government, however, strongly denied any links between the investigation and the Anaklia project.

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