Founded in 1997, Silk Road Group (SRG) is one of Georgia’s largest and most well-established companies, operating across a diverse range of sectors, crucial to the country’s wider economic success. Founded by George Ramishvilli, the company began in logistics, after winning its first major contract to transport petroleum products from Baku, Azerbaijan to Batumi, Georgia.
These early efforts in transporting vital resources in and out of the country required developing relationships beyond borders and took advantage of Georgia’s unique position as a bridge between East and West. The company name reflects the country’s historic position as a key node on the ancient silk road. SRG’s transportation network helped support major international companies entering the region for the first time in the post-Soviet era, establishing Georgia as a key interchange between the newly opened up East and the West. All SRG’s subsequent business ventures were construed around the same logic.
Steadily SRG’s burgeoning logistics operations contributed to the development of Georgia’s basic infrastructure, providing the building blocks for the country’s modern-day business success. At the height of the business’s transportation era, SRG was moving 2,500 rail cars per month from the Caspian Region to the Black Sea.
Following the Rose Revolution of 2003, the company identified other opportunities for investment in the Georgian economy and began to diversify. Recognising Georgia’s potential as a tourist hub, SRG turned its attention to the hospitality sector. Echoing George’s passion for restoration, later seen to full effect with the restoration of the historic Tsinandali Estate, SRG started with a redevelopment of Tbilisi’s iconic Hotel Iveria, which had fallen into a state of disrepair. As Georgia continued to open up to the world, a financing partnership with BTA Bank allowed SRG to rapidly develop the country’s hospitality infrastructure, predominantly through a partnership with Radisson. This was required to host the growing number of tourists and business people looking to invest their time and money in the country.
Applying this same philosophy of connectivity, SRG commenced investment in Georgia’s then outdated telecommunications network. In 2007’s privatisation auction, the company acquired the United Telecoms Company of Georgia, viewing the acquisition as key to its strategy of wider regional integration. Recognising early on the necessity of a modernised telecoms network to Georgia’s wider economic prospects, SRG set to work investing in sweeping infrastructure and organisational changes.
The early 2010s saw SRG continue to ramp up its telecoms offering, consolidating the company’s assets into the newly formed Silknet. This new company has instantly become Georgia’s largest cable network, offering the full suite of fixed-line, internet, cable TV and mobile services to more than half of the country’s households and businesses. More than $100m of investment also greatly improved telecoms connectivity to neighbouring countries and the wider world.
The final piece of SRG’s diversified portfolio came in the form of clean energy, with the company recognising the massive potential of the technology in Georgia. SRG now has an installed capacity of 10MW, with a further 40MW under development, providing Georgia with the further economic boon of exporting clean, green power to its regional neighbours.
The Company Today and Road Ahead
Today SRG is Georgia’s third largest private enterprise and is at the heart of the country’s ever-modernising infrastructure. Employing approximately 5,000 people and having invested nearly $1bn in the country since its founding, the company has been a leading player in Georgia’s successful transition from Soviet-era stagnation to a modern capitalist economy.
Today, Georgia stands 6th in the World Bank’s ‘Ease of Doing Business’ index and enjoys EU Associate Member status. This economic success has been built on the modern infrastructure that SRG has been a driving force in building. Taking advantage of Georgia’s unique position in the world, SRG’s future focus is ensuring the country’s infrastructure continues to modernise.
Silknet’s upcoming $200m bond issue, following last year’s purchase of Geocell, one of Georgia’s largest mobile phone operators, is indicative of SRG’s desire to take its investments to the next level. The funding will be dedicated to upgrading the mobile network towards full 5G and ensuring the country’s telecoms network is one of the most modern in the world. Elsewhere, projects are underway to increase SRG’s clean energy capacity by 5 times, offering a significant boost to the company and country’s environmental credentials.
It is in the tourism sector that SRG is undertaking perhaps their most exciting developments. The ongoing Silk Tower project in Batumi will see hundreds of jobs and thousands of tourists come to the area, providing the region with a significant economic boost. With media outlets, such as the UK’s Daily Telegraph, hailing Georgia as ‘the new Puglia’ and new direct flights to the country continually emerging, SRG is uniquely placed to take full advantage of an expected influx of visitors.
The development perhaps closest to owner George Ramishvili’s heart, however, is the restoration of Georgia’s Tsinandali wine estate. This beacon of the country’s history and culture had fallen into a state of disrepair after years of neglect, before being purchased by SRG in 2008. The estate is situated at the epicentre of the country’s wine industry, a drink invented in Georgia. In partnership with his friend Yerkin Tatishev, George helped restore Tsinandali to its former glory. This year it will host the inaugural Tsinandali Festival, an International festival of classical music, bringing together some of the biggest names in classical music with emerging younger talent.
Tsinandali represents the crown jewel in SRG’s desire to raise the profile of Georgia as a regional arts and culture hub. In addition to this, George, as a patron, has been integral to the Georgia Ski Federation’s successful efforts in bringing the FIS Ski & Snowboard Freestyle World Championships to the country.
All this, combined with the company’s wider operations, has cemented SRG’s belief that Georgia’s success is Silk Road Group’s success.