The Group is majority owned and controlled by the Batterjee family of Saudi Arabia through their Saudi Arabian registered holding company, Bait Al Batterjee Medical Co. Ltd (“BAB”). Engineer Sobhi A. Batterjee, the President and CEO of the Group, is the majority owner of BAB with 57% ownership.

The total cost of the expansion program is expected to be $370 million. SGH has requested that IFC provide up to $70 million of corporate funding to be used for its expansion programs in MENA and Ethiopia.

55.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	25.0
Equity	30.0

* These investment figures are indicative

The expansion will include Greenfield facilities in the following locations:

- 300-bed hospital in Cairo, Egypt;
- 30 specialty clinics in various locations around Cairo, Egypt;
- 100-150-bed hospital in Addis Ababa, Ethiopia; and
- Nursing school in Cairo, Egypt.

This project has the potential for significant developmental impact through:

- Delivery of high quality healthcare services to underserved areas in the target countries: The need for high quality healthcare is acute in Egypt and Ethiopia. SGH’s expansion will bring much needed capacity and new services to the MENA and Africa regions.

- Increase availability of high quality private medical universities and training school throughout the MENA region: A key health challenge in the MENA and Africa regions is the shortage of skilled medical personnel, in particular nurses due to a lack of training institutions and migration out of the region. In addition to healthcare services, the Group is focused on medical education, training in nursing and allied sciences.

- Demonstrate best practices throughout the medical community: SGH’s focus on quality in both patient care and management will make it a leader—and thus a point of reference—in the MENA and Africa regions. The Group is aiming to achieve JCI accreditation by 2009, and plans ultimately to bring all of its hospitals to this standard.

- Increase in Foreign Direct Investments: Such FDIs are extremely important for the countries in increasing the confidence in the local economies and also strengthening south-south cooperation.

- Extend public health and education programs: In addition to providing high quality care, SGH has extensive public health and education programs, which are offered free of charge to the community. Activities include community programs in HIV/AIDS, drug abuse, and maternal and child health.

IFC’s investment is expected to have the following contributions:

- Through this investment, IFC will be actively contributing to improving access to quality healthcare services in MENA and East Africa and promoting private healthcare development.

- Through its equity investment, IFC would be able to further contribute to improving the corporate governance and operating practices of the Group’s hospitals, in which the sponsor has expressed interest.

- Long term financing to private hospitals is not available in the target countries. IFC’s financing will have two main impacts. Firstly, it will allow SGH to utilize external funding sources to supplement internally generated funds and new equity injection to complete the expansion in a shorter time frame. This will allow it to offer healthcare services earlier to its target communities. More importantly, it will have a strong demonstration effect among the local financial institutions who may be encouraged to consider providing longer term financing respectively to this vital sector.

- SGH sees value in IFC’s participation, particularly its global experience in financing healthcare companies and its expertise in and knowledge of the private healthcare sector in developing countries. In particular, SGH will benefit from IFC’s experience in sub-Saharan Africa as the Group begins its project in Ethiopia and continues to expand in the Africa region.

This project has been classified as a Category B project according to IFC’s Environmental and Social Review Procedure. The SGH Group will manage environmental and social risks in accordance with the IFC’s Performance Standards on Social and Environmental Sustainability.

In this context, the Group will implement internationally accepted design standards and good hospital management practices in terms of life and fire safety including emergency response; disinfection, sterilization, hygiene control mechanisms required to prevent infections among patients, employees or students; provision of training to the employees and students; appropriate potable water supply; housekeeping; hazardous materials handling and minimization; waste, emissions and effluents minimization and proper disposal.

The Group will look for energy efficiency and other resource conservation opportunities and will be required to develop and implement a corporate-wide, integrated environmental, health and safety management systems. The Group undertaking several community outreach programs in its existing facilities, will extend these programs to the new locations of activities and will always be disposed to provide emergency care for the poor and disadvantaged communities.