The owners of struggling Georgian mineral water producer Borjomi are to transfer a part of the company’s shares to the government free of charge, the company has announced.
On Thursday, Borjomi told OC Media that following negotiations with the Georgian Government, the producer’s controlling company had submitted a formal proposal to transfer the shares.
Russian Oligarch Mikhail Fridman, who has been sanctioned by the West over the Russian invasion of Ukraine, owns a controlling stake in Borjomi. On 29 April Borjomi indefinitely ceased production citing financial difficulties, including a lack of access to banking services, brought about by the war. Both Russia and Ukraine are also among Borjomi’s top export markets.
‘This step will allow the Georgian Government to participate in the management of an international company’, the company said on Thursday.
‘After the Georgian government approves the offer […Borjomi] will be able to restore the production process in the factories and resume economic activities.’
The company did not specify how many shares would be transferred to the government.
Borjomi water is a major employer locally, with the company stating that over 1,000 people risked losing their jobs if production was not restored.
The government has not yet announced their position on the transfer. However, the day after the company ceased production, Prime Minister Irakli Gharibashvili said that the government would provide ‘good news’ about Borjomi ‘very soon’.
On 5 May, Borjomi fired 49 employees who the company said had refused an offer to halve their pay while production at their two factories was shut down.