The General Partner (GP) of Proa II is Proa S. A. Administradora de Fondos de Inversion (Proa S.A), a Chilean joint-stock company constituted on June 7, 1995. The GP has four dedicated senior partners. Combined, the GP team has 30 years of experience in private equity, investment management and investment banking. Proa S.A. is sponsored by and a subsidiary of Moneda, one of Chile’s fastest growing fund managers with $520 million in assets under management. Currently, Moneda manages six investment funds: Pionero, Colono, Proa I, Moneda Deuda Latinoamericana, TOESCA and Chiletech. Moneda partners include Messrs. Sergio Undurraga, Antonio Cruz, Pablo Echeverria and Jose Miguel Musalem, who together hold 80% of Moneda’s ownership. IFC owns the remaining 20%.

Proa II’s target size is $60 million and the proposed IFC equity investment is $10 million for capital contributions as well as management fees and expenses. IFC proposed investment represents 17% of the Fund’s size.

11.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	11.0

* These investment figures are indicative

The Fund will be structured as a “Fondo de Inversiones de Desarrollo Industrial-FIDE” in Santiago de Chile. The geographical focus of the investment is Chile. The investment team will be operating from the Moneda offices in Santiago.

Proa II will achieve the following development impacts: - support private equity in the region, contributing to more viable companies; - enhance the competitiveness of about 8-10 mid-market enterprises through equity investment and managerial and strategic support; and - promote corporate governance and environmental best practices. In addition, Proa II will have a strong demonstration role in supporting the second generation of private equity funds in the Chilean market. The first generation of Chilean private equity funds were launched in the mid-1990s. Many of the original fund managers have closed operations or transferred the administration of their funds to other management groups. The Proa team is highly regarded in the local industry for: - introducing new methods of doing business and - pioneering corporate governance. The Chilean government is interested in encouraging the formation of a second generation of private equity funds and recently introduced more flexible private equity legislation. - IFC’s role will provide support to the Chilean private equity asset class. As one of the largest and most visible investors in emerging markets in general, and in Chile in particular, IFC, through its commitment to Fund II, will signal its support to the asset class, which is still at an early stage of development in Chile. - Advisory Committee (“AC”). IFC will negotiate a seat on the Advisory Committee in order to monitor Fund II's activities as well as potential conflicts of interest and other governance matters. - IFC's Catalytic Role. IFC's investment will help Proa II to reach critical economic size, maintain the depth of the team's expertise and maximize its demonstration effect. Proa's team believes its ability to attract institutional investors will be significantly improved by IFC's continued presence as a limited partner. - Sustainability of the investees. IFC will contribute to the sustainability of Fund II's investments by playing an important role in the definition of corporate governance and environmental standards to be applied at the investee company level.

This is a category FI Type 2 project according to IFC’s environmental and social review procedure. As such, the GP has committed:

- to undertaking an environmental and social review of each sub-project;
- to requiring all sub-projects to be carried out and operated in compliance with applicable host country environmental; health and safety requirements, in accordance with IFC safeguard policies and consistent with IFC''s Exclusion List;
- to requiring that Category A sub-projects meet the World Bank Group’s applicable environmental, health and safety guidelines; and,
- to obtaining IFC’s clearance prior to making any category A investment.

IFC has an existing project, Proa I, which has had the same requirements and as a result, the sponsor has developed an Environmental Management System and trained personnel to review projects.
Location of environmental documents in locally affected community
The Fund does not envision investing in category A projects. Most investments will be in the categories B and C. Environmental documents and permits for Category B and C projects will be duly disclosed in the locations specified by the Chilean Environmental Authority.