OCIL is a joint venture between Owens Corning (OC) USA, which owns 78.5% through its wholly owned subsidiaries IPM Inc. & OC NL Invest Cooperatief, U.A., and Mahindra & Mahindra, (M&M), India, which has a 21.5% stake. OC is the inventor as well as world’s leading glass-fiber manufacturer. M&M is India’s leading manufacturer of utility vehicles and tractors in India.

In October 2000, OC filed for voluntary protection under Chapter 11 of the United States Bankruptcy Code due to litigation regarding its asbestos liabilities. OC''s Plan of Reorganization (for details of the plan, visit www.ocplan.com), approved by the US Bankruptcy Court, became effective on October 31, 2006, marking the company''s emergence from Chapter 11. The plan is the result of an agreement the company reached in May with key creditors groups. OC''s creditors, including asbestos claimants, bondholder and trade creditor classes, as well as bank debt holders and shareholders, supported this plan. Following this, the stock of OC has been listed on NYSE at $30 and currently trades at $35.43

OC reported record consolidated net sales of $6.5 billion in 2006, compared with $6.3 billion in 2005. Excluding items related to the company''s Chapter 11 proceedings, asbestos liabilities, restructuring and other activities, fiscal 2006 income from operations was $569 million, or 8.8% of sales, compared with $544 million, or 8.6% of sales in 2005.

Total project cost is estimated at $39 million. The proposed IFC investment is a $12 million A loan for IFC’s own account.

12.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	12.0
Equity

* These investment figures are indicative

The project is being implemented at OCIL’s existing manufacturing facility at Taloja, 40 miles from Mumbai in the state of Maharashtra. Taloja is an industrial zone.

IFC’s investment is expected to reinforce OCIL’s ongoing contribution in building a sustainable domestic fiberglass sector. In many applications, fiberglass provides a better alternative to traditional materials such as steel, wood and aluminum, in terms of cost and durability. OCIL, through working directly with fabricators and end users to develop applications, has actively helped the market grow in India by educating customers on the advantages of fiberglass reinforced plastics. Given India’s very low per capita consumption of fiberglass, there is considerable scope for ‘catch-up’ growth. Industries in India that stand to benefit from increased use of composites include infrastructure, electrical equipment, telecommunications, building and construction, automotive, and marine. Fiberglass is a key input to India’s growing wind turbine manufacturing industry.

Since IFC’s original investment in OCIL, it has played an important role in stabilizing the company’s debt profile, ensuring a proper match of cash from operations with debt service requirements. OCIL appreciates IFC’s involvement as a true partner when it entered India’s nascent fiberglass sector. The company values IFC''s fairness and finds comfort in its presence as a senior lender. Up to now it has relied heavily on OC for support, but going forward wants to evolve as strong independent entity and for this reason would like to continue with IFC as a lead lender. A repeat investment by IFC will signal confidence in the company and help attract a wider set of funding sources in its future growth plans.

This is a Category B project according to IFC''s environmental and social review procedure which consisted of appraising technical, environmental and social information submitted by the company. The appraisal team interviewed staff at both corporate and site operations, Human Resources and EHS managers. The appraisal included site visits to the company''s existing plant at Taloja. The following environmental, health, safety and social aspects of relevance to the project were analyzed:

- social and environmental assessment;
- corporate environmental, social, occupational health and safety management system;
- community consultation disclosure and engagement;
- labor and working conditions including management of occupational health and safety; and
- pollution prevention and abatement (including management of resources like energy and water, management of hazardous and other materials, management of emissions, discharges, hazardous and other wastes) and management of impacts on ambient conditions.

The company already has adopted policies & practices that very significantly compliant in all material respects with host country Regulations, OC group standards and many of IFC’s standards. In tune with its philosophy of continuous improvement, the company has presented plans to address project related social and environmental impacts. The proposed project will, upon implementation of the specific agreed measures, comply with the host country laws and regulations, IFC''s social and environmental policies and Performance Standards, and the WBG/IFC environmental health and safety guidelines. A summary discussion on the company''s plans to mitigate/minimize identified social and environmental impacts has been provided in the Environmental and Social Review Summary (ESRS) and an Environmental and Social Action Plan (ESAP).