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Monopoly in domestic aviation - to whom the state pays tens of millions in subsidized flights

Saturday, 23 April 2022 13:03 hits 645 times
Prime Minister Irakli Gharibashvili and Amiran Manjavidze (at the centre of the photo) in Natakhtari, 2014
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Prime Minister Irakli Gharibashvili and Amiran Manjavidze (at the centre of the photo) in Natakhtari, 2014

"Your dreams - our wings" - this is the slogan of "Vanilla Sky", which sells tickets for flights to Mestia, Ambrolauri and Batumi. These flights are funded by the state, with millions of GEL every year. Only two companies are participating in the tenders and both of them have one founder, Amiran Manjavidze, the owner of "Vanilla Sky ".

The state pays 50 million for domestic flights to the businessman's company, "Ak-Air Georgia". Manjavidze's another company, once blacklisted "Serviceair LLC", which owns Natakhtari Airport, also successfully participates in the tenders of the Ministry of Defense. His companies have signed contracts totaling GEL 75 million in the last 10 years, through budget tenders and direct procurement.

Amiran Manjavidze is a longtime friend of Gia Volski, Vice-Speaker of Parliament, and Volski's wife is the head of Vanilla Sky's sales department. Manjavidze's business partners are also connected with the ruling party in various ways. Both Gia Volski and Amiran Manjavidze categorically deny to "Mtis Ambebi" that Manjavidze's success in public procurement is linked to their friendship and closeness to the Dream.

 

Unfulfilled commitment and a new tender for a new company

Amiran Manjavidze acquired the right to domestic flights in 2014, right after the start of the subsidy program, but in 2017, his "Service" was terminated prematurely by the "Union of Airports". Right after that, another Manjavidze company "Ak-Air Georgia" appeared in the aviation business.

The purpose of financing domestic flights from the state is to create affordable airfare, which should promote the development of domestic tourism. According to a government decree, the Union of Airports has announced three tenders for domestic flight subsidies.

The first three-year contract with Amiran Manjavidze's "Service" was signed in May 2014, for 11.2 million GEL, of which, according to the State Procurement Agency, the winning company spent only 7.8 million. After the expiration of the deadline, in May 2017, a new tender was announced for the same service, with slightly modified requirements. This time, the Union of Airports was looking for a company with 10 years of experience in aviation. "Serviceair", founded only in 2002, still participated in the tender and signed a contract for 10.7 million GEL.

Eight months after the contract was signed, Serviceiser wrote to the customer that it would no longer be able to provide services at the price specified in the agreement, which the union considered a breach of obligations. "Serviceair" was deprived of the right to participate in public procurement for one year.

By this time, Amiran Manjavidze had already founded a new company, "Ak-Air Georgia". After the termination of the contract with "Serviceair", the "Union of Airports", with the consent of the government, signed two agreements with "Ak-Air" in a simplified manner and paid him 3.2 million GEL in 8 months.

In the justification of the direct contract, the Airports Union explained to the State Procurement Agency that none of the airlines registered in Georgia was willing to cooperate with them, which is why "Ak-Air Georgia" was the only candidate for the direct contract.

The next tender, in 2018, was held on favorable terms for "Ak-Air". The winner was to be served for 4 years instead of 3 years, and the one who asked the company for 10 years of experience and could not have Ak-Air created in 2017 was no longer in the tender. Only "Ak-Air Georgia" participated in the auction and finally, in September 2018, a 50 million contract was signed.

According to the state audit report, the average cost of a flight / hour in the 2017 tender was $ 1,000. This amount increased from $ 1,620 to $ 2,446 in the contracts concluded with Ak-Air as a result of the 2018 auction.

Why was it no longer necessary for the participants of the 2018 tender to have 10 years of experience, if such expertise was required by the "Union" in 2017? - We contacted the "Union of Airports" with this question, where we were refused to comment because the management has changed since then and we had to ask for this explanation in a letter of public information.

We have asked the "Union of Airports" to provide public information before. To find out which companies they negotiated with in 2017 before directly selecting "Ak-Air", we requested copies of the letters they sent to the market research stage. We have not yet received a response to the letter sent on February 3.

Ak-Air Georgia operates the following flights within the subsidy program: Tbilisi-Batumi-Tbilisi, Natakhtari-Mestia-Natakhtari, Natakhtari-Ambrolauri-Natakhtari, Kutaisi-Mestia-Kutaisi. One way to Batumi flight costs 125 GEL for an adult passenger, Natakhtari-Mestia - 90 GEL, and Natakhtari-Ambrolauri and Kutaisi-Mestia - 50 GEL. According to their website, "Vanilla Sky" also has flights In the direction of Vardzia, Kazbegi, Shatili, and Omalo.

 

Activities and business interests of Amiran Manjavidze

Amiran Manjavidze's name is associated with about ten companies - he owns the only private airfield in Georgia. Among its investors is one of the Latvian businessmen, Konstantin Soloduha, who, according to Latvian media, is accused of arms trafficking and bribery.

Amiran Manjavidze has been involved in the aviation business since 2002, after founding "Serviceair Ltd". Most of its companies are engaged in aviation or related activities.

Companies related to Manjavidze are uncompetitive in performing domestic flights on the Georgian market. No other company registered in the country has aircraft that meet the criteria required by the government. According to the Civil Aviation Agency, there are 12 airlines registered in Georgia, 8 of them operate passenger flights and most of them operate international flights. Only three companies operate in the field of domestic flights, "Aero Expedition", "Aviaservice" and "TCA". The companies told "Mtis Ambebi" that they did not have the 15-30-seat aircraft required for domestic flights and could not participate in a similar tender.

In addition to suitable aircraft, Amiran Manjavidze's company owns an aerodrome from which domestic flights are completed.

The area where Natakhtari Airport, "Vanila Sky "Complex and other Manjavidze businesses are located was bought by the businessman from the state in 2008. Amiran Manjavidze then paid 1,984 GEL for 49.6 hectares of agricultural land.

Flights started shortly after Natakhtari, and in 2013 an aerodrome for regular domestic flights was officially opened in the area. After the announcement of the subsidy, members of the government and Prime Minister Irakli Gharibashvili arrived in Natakhtari, where he spoke about the importance of the program in his speech.

Amiran Manjavidze's business interest is also Alpha Natakhtar "Terminal Ltd. ", which operates on the territory of his aerodrome, Manjavidze's share here is 10%. Mirian Gogiashvili, the former Minister of Finance of the company, holds the same number, having held positions in state agencies and international organizations at different times. Finally, he ran a state-sponsored sectoral and regional development company. He was also a consultant to the "Partnership Fund" of the Ministry of Economy. Gogiashvili's share in Alpha Natakhtari Terminal is 10%, the same is owned by businessman Akaki Svanidze, who, according to his social network profile, is also close to Gia Volski and an active supporter of the Georgian Dream. 70% of the company is owned by businessman Giorgi Nanava. Mirian Gogiashvili is a director of Nanava's another company.

In 2017, after violating the agreement with the Union of Airports, new investors appeared in Amiran Manjavidze's companies.

In June, Manjavidze founded Service Holding Ltd., which now owns a 100% stake in both "Serviceair" and "Vanilla Sky". Amiran Manjavidze owns 49% of "Serviceair Holding", Latvian businessman Konstantin Soloduha owns 2% and Irakli Kutalia, director of Ak-Air Georgia, owns 2%. Amiran Manjavidze also owns 59% of "AK-Air"; Latvian company "Wings 4 sky" and Konstantin Soloduha own 20% each. 5% is owned by Michael Feofanov, dual resident of Georgia and Cuba; 1% is owned by Irakli Kutalia.

According to Latvian media, Konstantin Soloduha is the co-owner of the major airline "Wings 4 sky" and Tukums airport, and he has been involved in several high-profile cases in recent years. According to the Latvian Public Television online platform, LSM, Soloduha is charged with criminal charges related to arms shipment and bribery. In 2021, he was even arrested.

 

"Your dreams - our wings"

"I have a normal friendship and I visit him from time to time. I know nothing on issues of tenders and subsidies. Why do you ask me? Did Khabeishvili deal with you? Ask him." - Replied Gia Volski when asked about Amiran Manjavidze's relationship with him.

"You are a young man and you probably do not know. Let's say he was given that 17 million. Maybe he was not. Besides that, there are commitments to fulfill and if the state gives him 17 million… As I know it never happened. According to my information the state did not finance the bare minimum. This money is not for personal use, it is for tourists. Those tourists spend more in hotels, infrastructure. This is business and the fact they were classmates is of no importance."

Is it in the interests of the vice-speaker to succeed in a business that also provides part of his family income? The wife's job is also mentioned by the MP in her 2021 declaration - Gia Volski did not answer the question about his wife's activities.

"I know he has a few, even one company that sells tickets and I do not think Amiran is doing anything illegal. There are subsidies from the state for what it has, I do not interfere in that. He is not a millionaire, he owes money to a bank and he is an ordinary businessman, and if you are interested in anything, ask him or his accountant. "

The latest extract from the public register shows that Amiran Manjavidze really owes a debt. He is a borrower of Cartu Bank. He pledged the shares of "Serviceair Holding", its subsidiaries and "Ak-Air" to Kartu Bank in 2014-2018. In exchange for engaging the shares, Manjavidze has a $ 4 million credit limit from Bidzina Ivanishvili's bank.

How did "Ak-Air", a company founded a year earlier, manage to get favorable terms in the 50 million tender, and why did the demand for 10 years of experience arise when "Serviceair", founded in 2002, participated in the tender and disappeared when it was replaced by "AK-air" founded in 2017?

"I have 22 years of experience, not 10 years, my company was established in 2002, you should study this issue well," Amiran Manjavidze could not hide his dissatisfaction with our question.

"I have the only company in Georgia that owns airfield and planes, you should first study the issue and then ask me who I am friends with and who I am not. Gia Wolski is my classmate, so what? Does any other company have their own aerodrome? Does anyone have their own planes?"

We also wanted to ask Amiran Manjavidze about his business partner, Konstantin Soloduha, but he hung up the phone and did not answer our calls.

"Serviceair" no longer provides air transport services after the termination of the contract and the appearance of "Ak-Air Georgia", although it wins the tenders of the Ministry of Defense without competition. The company is the sole supplier of aviation gasoline (AVGAZ 100 LL.) To the agency. Since 2019, it has provided more than half a million GEL in fuel to the Ministry.

Amiran Manjavidze's companies "Serviceair" and "Ak-Air Georgia" have signed contracts for a total of 75.6 million GEL since 2010. Among them is the current 50-million contract and the amount of up to 4 million GEL, which was paid directly to Manjavidze's companies without a tender. More than 10 state agencies bought services from him.

Author - Robi Zaridze

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