Russian-owned Borjomi suspends production in Georgia due to sanctions
“Borjomi” temporarily suspended production
Mineral and fresh water company IDS Borjomi in Georgia is temporarily suspending production due to the sanctions introduced against the company’s owner, Russian oligarch Mikhail Fridman.
“We want to inform you that since the beginning of hostilities in Ukraine, IDS Borjomi Georgia has found itself in a difficult situation. The difficult situation in the main sales markets for the company’s products was exacerbated by limited access to bank accounts, which prevented the company’s ability to receive foreign exchange earnings and settle accounts with creditors. The company continues to work to this day in the hope of significantly improving the situation, which, unfortunately, has not yet succeeded.
In connection with the above, the company is forced to temporarily suspend the production process at both Borjomi bottling plants from April 29.
“We hope that the situation will improve in the near future, and we will have the opportunity to resume work”, the company said in a statement.
The controlling stake in IDS Borjomi was acquired by Alpha Group in 2013. The founder of Alpha Group is the sanctioned Russian billionaire Mikhail Fridman.
His company also appears in a study by Transparency International Georgia, according to which more than 7,000 companies are registered in Georgia, which are wholly or partially owned by companies and / or citizens of the Russian Federation.
According to Transparency International, 410 Russian companies participated in Georgian public procurement in 2011-2021. These companies have received contracts worth up to 590 million lari [about $170 million], which is about 1.4% of the amount spent on public procurement in Georgia in 2011-2021.
Until June 2021, the director of Borjomi was a Russian citizen Mikhail Provotorov, who was replaced by the former Minister of Finance of Georgia Ivane Machavariani.
It should be noted that in early March, Estonian retail chains announced that Borjomi was being withdrawn from sale as a Russian product.
