The Georgian National Competition Agency has approved the concentration of “Anagi Development 2” and “White Square Isani” in the construction market and the concentration between “Diplomat Georgia” and “Kant” in the FMCG market, the agency said Tuesday.
In one case, the case concerns the purchase of a 50% share of "Anagi Development 2" from "Anagi" by "White Square Isani". To examine the compatibility of the concentration with the competitive environment, the Agency evaluated the market of the construction of residential and non-residential buildings. According to the received and processed material, the volume of the mentioned market in 2022 amounted to 8,084,435,501 GEL, the market concentration index Herfindahl-Hirschman Index (HHI) is 61.41, which is an indicator of a low concentration market. As a result of the implementation of the concentration, the HHI is 64.14, and the index change according to HHI is 2.73.
According to the Agency's decision, as a result of the planned concentration, there is no significant change in the concentration index in the relevant market, and does not substantially restrict effective competition and are compatible with the competitive environment.
Regarding the second concentration, the purchase of 75% share of "Kant" by "Diplomat Georgia". The Agency assessed the competitive environment in the import and wholesale trade of food and beverage products, as well as in the market of distribution services.
In the food and beverage import market, in 2022, 883 companies were operated, the market volume is 368,159,584 GEL, the Herfindahl-Hirschman index (HHI) is 250.69, which is an indicator of a low concentration market. After the implementation of the concentration, the HHI is 252.32, and the change in the concentration index according to the HHI is 1.64
In 2022, 1106 companies were operated in the food and beverage wholesale market, the market volume is 4 562 139 613 GEL, the Herfindahl-Hirschman Index (HHI) is 213.54, which is an indicator of a low-concentration market. After the implementation of concentration, HHI is 232.75. Change in concentration index HHI 19.22.
In the distribution services market, in 2022, 70 companies were operated, the market volume is 5 508 465 832 GEL, according to HHI it is 479.49, which is an indicator of a low-concentrated market. After the implementation of the concentration HHI is 498.39. Change of concentration index HHI 18.90.
As a result of the study, the Agency determined that the implemented concentrations in accordance with the Law of Georgia on Competition, does not substantially restrict effective competition and are compatible with the competitive environment.
In 6 months of 2023, the concentration of 12,119 companies registered in Georgia was verified. The Agency has approved 3 concentrations. At this stage, 1 planned concentration is being processed in the Agency.
