The National Commission for Communications of Georgia (NCCG) is considering a request by the Russian telecommunications company OAO Vympelcom, which operates in Georgia through OOO Mobitel Mobile Operator (under the Beeline brand). The request is about participation in the negotiations on purchasing the largest Georgian Internet company, Caucasus Online. According to Georgian law, the NCCG has to check whether the possible deal contradicts the antimonopoly legislation of the country. And only after its decision will serious negotiations between the potential seller and a purchaser possible. Apparently, the commission’s answer will be positive.
Today Moscow is attentively following the process to prevent a discrimination policy against one of the largest Russian companies working in the promising communications market of Georgia and the South Caucasus.
When the NCCG makes a positive decision, Mobitel will have to hold difficult negotiations with Caucasus Online. Its owners are interested in selling the company, but there are two claimants – not only Vympeltelekom, but also the largest Georgian mobile network operator, Magti, which belongs to Giorgi Johtaberidze, a son-in-law of the late ex-president of Georgia, Eduard Shevardnadze, want to purchase Caucasus Online.
The American partners of Mr. Johtaberidze own the blocking share holding of Magti, i.e. the Russians have to compete with the Georgian-American company and overbid Magti. It will be difficult to do, as Giorgi Johtaberidze and his American partners, who have already got a principle positive answer from the NCCG to hold negotiations with Caucasus Online, are very interested in purchasing the active shares.
The rivalry for the Georgian company is explained by a serious reason: the sweetest spot of Caucasus Online is the optic fiber cable South Caucasus-Europe, which is 1200 km long. Caucasus Online possesses the Georgian segment of the trunk; and if the company is sold, the new owner gets rights not only to provide private Internet services, but also for control over the strategically important communications which provide a significant share of Internet traffic in all three states of the South Caucasus.
Therefore, the opposition, i.e. supporters of former president Saakashvili and his party the United National Movement, has already stated that it stands against the possible deal with the Russian company, accusing the authorities of striving to “hand the vitally important sphere of communications to the Kremlin and Russian special services.” Giorgi Kandelaki, an MP from the UNM, made such a statement, for example.
However, the Russians are playing their game delicately, stressing that their goal is only “diversification of business and development of communications, not only in Georgia, but also throughout the whole region.”
However, the sensitive communicational sphere is always under political risk. The American embassy in Tbilisi is also attentively following the rivalry between Magti and Mobitel, so the fight for possession of Caucasus Online and the very important communicational trunk will be acute and interesting.
