PMI is a private company closely held by Maitland-Smith family and friends. The founder, Mr. Paul Maitland-Smith has been in the high-end furniture production business for over 50 years, most of which has been in Asia. The major shareholders of the company are Mr. Paul Maitland-Smith (31%), Sherrill Furniture company (a US-based company) with 25% shareholding and Mr. David Pemberton (17%). 28 other individuals own the rest of the shares, none of whose holding exceeds 7%.

The total transaction is estimated at $22 million project, which involves predominantly the expansion of permanent working capital and the refinancing of short-term debt. A small component (9% of project cost) of the funding would be directed towards the installation of an Enterprise Resource Planning (ERP) and MIS system, the establishment of warehouses and the development of an acacia plantation. IFC’s proposed investment is $8 million in the form of an A Loan.

8.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	8.0
Equity

* These investment figures are indicative

PMI has three sites in Vietnam including 2 manufacturing facilities, and a plant with a saw-mill, dry kiln facility and a foundry. The company also has approximately 600 hectares of acacia plantation. The IFC investment will be directed towards activities at the two manufacturing facilities in Ho Chi Minh City – - Theodore Alexander HCM Ltd. (TAHL), a 334,000 sq. feet, 4-storey manufacturing facility constructed in the principal export processing zone and - Saigon Fine Furniture (SFF) is a 430,000 sq. feet manufacturing facility situated in Linh Trung Export Processing Zone (EPZ) II.

Development Impact: PMI is an internationally competitive and innovative export company that specializes in high quality furniture design and manufacture. The Company has achieved low operating costs in Vietnam despite a partial reliance on imported wood. PMI benefits from high quality design capabilities, an internationally strong brand name and low cost skilled labor. In addition to its own manufacturing facilities which employ nearly 9,000 employees, PMI outsources a significant portion of its operation to five local furniture makers who recruit close to 2,000 employees. The Project will allow the company to expand its in-stock high-end furniture line through increases in working capital and enhance its fixed assets (warehouses and plantation). The Project is expected to profitably expand the product line, create a more efficient capital structure, and earn good returns for its stakeholders. Domestic subsidies appear to play no role in the company’s profitability. IFC Role: - Provision of Longer Term Financing: Although PMI is very profitable; the company has limited access to longer-term facility. IFC’s provision of long-term debt to PMI would broaden the Company’s source of long-term funding and help the company meet increasing international demand for high quality products with shorter delivery time. - Comfort to other Investors on Corporate Governance: PMI recognizes the need to improve its corporate governance. IFC’s has provided the company with the information on its corporate governance website and its presence will provide comfort to other investors and further legitimize the company in its preparation for listing. - Environmental Improvement: IFC would help the company meet the WBG requirement for sustainable procurement of wood.

This is a Category B project according to IFC’s Environmental and Social Review procedure. Environmental, social and health and safety issues which may be associated with this project and which will be reviewed during project appraisal include: environmental and occupational health and safety management, wood sourcing from sustainably managed forests, air and water emissions, solid waste management and disposal, hazardous materials management, fire protection and emergency response and workplace conditions including occupational health and safety.
Location of environmental documents in locally affected community
The environmental document Environmental Review Summary (ERS) will be available at the Company’s headquarters in Ho Chi Minh City.