Shareholding : Chola is held by the promoters - various companies and individuals of the Murugappa group (37.48%) and DBS Bank Ltd. Singapore (DBS)(37.48%). The balance 25.04% is held by the public. On 30th March 2010, the Murugappa Group represented by Tube Investments of India Ltd. And DBS have signed a share purchase agreement by which the Murugappa Group will be buying the 37.48% equity together with the 50% preference shares held by DBS. The transaction is expected to close on or before 12th April 2010. Post this , the Murugappa Group will hold 74.96% in Chola. Sponsors : The Murugappa group is a large diversified conglomerate with a combined turnover of US$3.14b. The group currently comprises 29 companies in diverse areas like engineering, abrasives, sanitary ware, fertilizers, finance, bio-products and plantations with over 30,000 employees. The group is run by the Murugappa Corporate Board with family members and three independent directors. Mr. A Vellayan is the group Chairman

The Company is planning to raise equity capital for future growth. IFC is considering an equity investment to support the growth plan of the Company. The investment would be made through the issuance of new common equity shares by the Company.

22.61 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	22.61

* These investment figures are indicative

The Company is located in Chennai, and operates in 171 branches across 18 states and 2 union territories in India. IFC investment would enable the company to enlarge its footprint across India.

Sustained access to road transport infrastructure finance: Chola is focused on smaller CV financing to small road transport operators to first time users which provide the last mile connectivity, a critical logistic link in the transport infrastructure chain. Supporting Chola will ensure continued access by a substantial franchise of more than 150,000 small operators for CV finance. Increased access to finance to the MSME segment: Chola's growth focus will continue to remain in rural areas serving the financially underserved population. The Company plans to penetrate deeper into the rural areas, by financing CVs and through loan against property and expects to increase its outreach to more than 500,000 customers in 3 years. Demonstration effect through consolidation of large NBFC: The proposed project will help the company to restructure its capital and consolidate its position. IFCs investment will further strengthen the Company's consolidation efforts and have a demonstration effect in the NBFC sector.

IFC's equity infusion will help the Company to supplement its capital for expanding its footprint across India , as well and provide finance to the MSME sector, through financing of light and small commercial vehicles. The company has just undergone a capital restructuring and is in the process of changing its business model to refocus on its core business of Commercial Vehicle financing. At this juncture IFC's equity participation, with its longer investment horizon, will help the company to re-organize its business and provide stability to its capital structure. IFC will engage with the company to provide technical assistance to improve the Company's risk management processes and policies as well as help in integrating its subsidiaries business with its core clientele.

This project has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure. Considering the nature of activities supported, the project will be required to:

 Develop a procedure relevant to its business process, prior to commitment, that is satisfactory to IFC, and that ensures that all its investments are screened and processed to ensure compliance with the applicable requirements;
 Identify qualified persons to manage and implement the procedure;
 Demonstrate commitment and resources to implementing the procedure;
 Demonstrate commitment to applying the labor standards established by the IFC Performance Standard 2: Labor and Working Conditions; and
 Submit a periodic report to IFC as per a format to be provided by IFC.