LONDON (ShareCast) - (Sharecast News) - Georgia Capital announced on Tuesday that its wine business has acquired a 100% equity interest in Alaverdi, which owns 244 hectares of vineyards in the Kakheti region, the vast majority of which grew Georgia\'s flagship red wine grapes, Saperavi.
The London-listed firm said the acquisition of Alaverdi also provided its wine business with access to 135 hectares of free land, available for immediate vineyard development.

It explained that the acquisition would triple the production capacity of its wine business to 28.4 million wine bottles per annum, from the current 9.4 million bottles, which would provide \"substantial relief\" in planned capital expenditures for the next few years.

Following the acquisition, the wine business would have 695 hectares of vineyards, with an additional 180 hectares of free land available for immediate vineyard development, in line with the board\'s target to reach a vineyard base of 1,000 hectares.

Based on Alaverdi\'s unaudited management estimates for the first half of 2019, the company\'s revenues and EBITDA were $2.2m and $0.9m, respectively.

Georgia Capital described Alaverdi as a producer of \"exquisite\" Georgian wines and spirits.

It said the \"highly valued micro-zones\", where Alaverdi harvested the country\'s \"most demanded\" wine categories on the domestic and international markets, occupied 82 hectares of its vineyards.

Alaverdi also added \"sizable\" existing wine inventory materials available for immediate sale.

The wine business would consolidate the results of Alaverdi\'s operations from the acquisition date, and expected that the acquisition will provide a \"significant\" cost advantage to produce red wines with mostly self-harvested grapes.

Georgia was in the top 20 global wine exporters, with growing demand for Georgian wine in recent years reportedly resulting in increased grape prices.

The prices were expected to further increase as Georgia continued to tap new export markets, supported by the implementation of various free trade agreements, including those with China and the European Union.

\"I am pleased to announce that our wine business continues to successfully progress towards its strategic priorities,\" said Georgia Capital chairman and chief executive officer Irakli Gilauri.

\"The acquisition of Alaverdi is a truly compelling opportunity, which provides a clear and attractive value creation potential through cost synergies and the addition of a substantial base of high quality vineyards.\"

Following the acquisition, Gilauri said the wine business would have three top class wineries across Kakheti\'s three wine-making regions, with \"significantly-enhanced\" production capacity.

\"This footprint should allow the wine business to access a bigger share of export markets, while also capitalising on the growing wine tourism in Georgia.\"

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