Market Overview

Update on Georgia Capital's holding in GHG


Georgia Capital PLC (the Group or Georgia Capital) holds
57% of the equity shares of Georgia Healthcare Group PLC (GHG),
the parent company of the largest and most diversified healthcare
provider in Georgia, which operates in the healthcare services, pharmacy
and medical insurance sectors. GHG
(NYSE:GHG) is a London Stock Exchange listed portfolio company. At
the time of the demerger from BGEO Group PLC, Georgia Capital announced
that it was highly probable that the Group would own less than a 50%
stake in GHG at the end of 2018.

In light of the prevailing market conditions, the board of directors of
Georgia Capital believes that the current share price significantly
undervalues the performance and prospects of GHG and has, therefore,
concluded that a further reduction of the Group's holding in GHG, at
this time, will not be in the best interests of its shareholders. As
such, it no longer expects to own less than a 50% stake in GHG at the
end of 2018. Therefore, starting from the second half of 2018, Georgia
Capital will fully consolidate GHG's financials in its IFRS statements.

Management Commentary

"Over the last few months GHG's share price has, in our view, not
reflected the company's strong performance and excellent growth
prospects. GHG's fundamentals have been steadily improving over the last
few quarters, and it delivered 22% EBITDA growth in 1H18. We manage our
capital needs such that we do not depend on premature liquidation of our
listed investments. Based on our capital allocation outlook, our net
investment plans for the next three years of GEL 128 million are
comfortably funded through existing liquid funds and short-term loans
issued, which currently stand at GEL 604 million."

This announcement contains forward-looking statements, including, but
not limited to, statements concerning expectations, projections,
objectives, targets, goals, strategies, future events, future revenues
or performance, capital expenditures, financing needs, plans or
intentions relating to acquisitions, competitive strengths and
weaknesses, plans or goals relating to financial position and future
operations and development. Although Georgia Capital PLC believes that
the expectations and opinions reflected in such forward-looking
statements are reasonable, no assurance can be given that such
expectations and opinions will prove to have been correct.

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