Catalyst Prviate Equity Fund I Limited

Summary of Proposed Investment

This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only.

Project number	27752
Company name	Catalyst Private Equity Fund I Limited
Country	MENA Region
Sector	Collective Investment Vehicles
Environmental category	FI
Department	Private Equity and Investment Funds
Status	Pend PDS-IR

Date SPI disclosed	September 8, 2009
Projected board date	October 30, 2009

Overview

Sponsor/Cost/Location

Development Impact

Contacts

Attachments

Project description

Catalyst Private Equity Fund I Limited (Fund) is a private equity fund which makes equity and equity-related investments in high-growth small and medium-sized enterprises (SMEs) in the Middle East and North Africa with a sector-specific scope on energy and water including clean and renewable energy, efficiency improvement tools for oil and gas, and water treatment and purification.

Anticipated development impact of the project

- Private sector development: The Fund will add value to its investee companies, by providing managerial and strategic support to improve their competitiveness and sustainability.

- Implementation of best practice for corporate governance in portfolio companies: The Fund will adopt international best practices for corporate governance and management, as well as transparency, thus fostering knowledge and skill transfer, and encouraging best practices across the industry.

- Support for SMEs: The Fund is expected to invest predominantly in SMEs.

- Climate change: the Fund’s investments in the clean energy sector are expected to provide positive impact on the reduction of greenhouse gas emissions.

IFC's expected development contribution

- Catalyze other funding from institutional and private capital: IFC’s participation will provide comfort to other investors and broaden the Fund’s investor base.

- Support an emerging fund manager: IFC will support the development of the local private equity industry by supporting a first-time fund manager.

- Governance of the Fund: IFC will seek to play a governance role through participation on the Fund’s governing structures.

Environmental and social issues - Category FI

This project has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure.

During appraisal, IFC will analyze the Fund’s expected portfolio and sectors of investment and determine the Applicable Requirements if any, that would include a combination of:

- The IFC FI Exclusion List and
- The applicable National Environmental and Social Laws and regulations and/or
- The IFC Performance Standards

IFC will also review, if required, the capacity of the Fund to manage social and environmental risks and to establish and maintain a Social & Environmental Management System (SEMS). IFC may suggest Supplemental Actions to address any gaps in the SEMS if required.

The Fund Manager will be required to:

- Develop an, or upgrade, if necessary, any existing SEMS, prior to disbursement to the satisfaction of IFC;
- Identify responsible, qualified persons to manage and implement the SEMS;
- Commit to implement the SEMS to ensure that its investments/activities are in compliance with the Applicable Requirements;
- Take action to remedy any gaps in SEMS implementation on an ongoing basis;
- Submit a periodic report to IFC as per a format to be provided by IFC.

IFC PROJECTS

RECENTLY DISCLOSED