TMPL is a 100% subsidiary of Taj Asia (TA), which is a 50:50 joint venture between Taj Group and Cigen Corporation. The Taj Group is the hospitality business arm of the Tata Group and operator of the two properties of TMPL. Taj Group will leverage its hotels and resorts management experience to run the TMPL properties. The flagship company of Taj Group is Indian Hotels Company Limited (IHCL) which has 50 properties in India and 10 properties overseas. Other companies in Taj Group include Oriental Hotels Ltd, Taj International Hotel Ltd, Taj Asia, and PIEM Hotels Ltd. Cigen Corporation is controlled by Chaudhary Group of Nepal. Chaudhary Group owns 5% of Cigen directly and the balance through associates. Chaudhary Group is engaged in banking, insurance and consumer goods sectors in Nepal.

Total project cost is estimated at $17 million. The proposed IFC investment is a $8.5 million A loan and a $8.5 million syndicated B Loan.

8.50 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	8.50
Equity

* These investment figures are indicative

TMPL is located in the Republic of Maldives and operates Taj Exotica and Taj Coral Reef resorts on the islands of Emboodhu Finolhu and Hembadhoo in the Male Atolls.

This is a category B project according to IFC’s Environmental and Social Review Procedure. Environmental, social, health and safety issues associated with this project include: management of resort operation waste streams and emissions; management of resort operation impacts on the marine environment, including coral reefs and marine fauna; life and fire safety of resort guests and employees; and employee occupational health and safety.

Location of environmental documents in locally affected community

Tourism is one of two mainstays of the Maldives economy (the other is fishing) but it relies on expensive and scarce stopgap financing that threatens the long term financial health of firms in the sector. Until now, TMPL has relied on parent support to find reasonably priced mid-term finance. The proposed refinancing will put the company on a sustainable financial structure and the involvement of other financiers will introduce the company to international markets on a stand-alone basis. In addition, linkages with the rest of the economy will also be created in fishing, and food and beverage supplies. Taj Group brings extensive training and international best practices in operating resorts which will increase the skill levels of local employees. IFC has a strong role in supporting the project as it provides: - Access to long-term capital. IFC would provide limited-recourse, long-term debt (ten or nine years) to TMPL, as financing on these terms is generally not available in the Maldives. Such support for TMPL will be a signal to the international commercial finance community of the improved investment climate in the country, as well as of the commercial viability of investment in the key tourism sector. IFC may also help mobilize additional long term financing by way of B-Loan syndication. IFC involvement will help implement an appropriate financial structure in the company. - Attract international financial institutions to participate in investments in Maldives. IFC may also help the company mobilize additional long term financing by way of B-Loan syndication. - Technical assistance in environmental and social best practices. While TMPL has been environmentally responsible in most aspects of operations, IFC has leveraged its ability to mobilize scarce long-term financing by convincing the company to implement a fire, life safety and water treatment improvements. In addition, TMPL will participant in a coral reef restoration program initiated by the IFC. - Encouragement of “south to south” Foreign Direct Investment. Taj Group is a leading Indian company with investments in Sri Lanka, Maldives, Nepal, Goa, and Zambia. The company’s expansion strategy includes investment in other developing countries such as Mauritius and Seychelles that demonstrate an increase in demand in global tourism. IFC’s investment will support foreign direct investment from India to other Part II countries.