Sound Global was founded in 1993 and has become one of the leading water treatment companies in China. Sound Global is listed in Singapore and Hong Kong. IFC made a pre-IPO equity investment of US$10 million in August 2006 (Project No. 25046) to support the Company’s core subsidiary in China, Beijing Sound Environmental Engineering Co. (Beijing Sound), as well as to assist Sound Global’s initial public offering (“IPO”) on the Singapore Stock Exchange (“SGX”). In September 2010, the company completed dual listing in Hong Kong in order to attract wider range of investors. The Company started its business as a turn-key EPC supplier for municipal and industrial clients in the Chinese water and wastewater treatment sectors. Sound Global has become a full-fledged water and wastewater treatment company including equipment manufacturing, EPC, and operation of wastewater plants.

The project is estimated to cost $64. IFC proposes aggregate financing support to Sound Global for its BOT projects of up to $36 million through an A loan.

36.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	36.0
Equity

* These investment figures are indicative

The BOT concessions are located in multiple provinces in China - Shaanxi, Jiangsu and Shandong.

The project would have high development impact through IFC support of a growing private sector company in the following aspects: i) Support a key private sector investor who is playing a meaningful role to address water shortage and environment pollution issues; ii) Support a private sector investor to expand business in the Frontier regions of China as 2 out of the 4 projects are located in one of the western provinces; and iii) Help Sound Global free up cash for international business development and potential South-South cooperation opportunities.

i) Access to long-term financing: Although Chinese banks are encouraged to lend to the utility sector, most of these banks are not keen in going into provinces where projects of Sound Global will be implemented. IFC financing is important to fill the financing gap and ensure the projects to proceed according to schedule, ii) Knowledge sharing: IFC can add value through sharing significant global expertise and best practices in the water sector and also provide a framework of guidance in corporate governance and environmental and social standards for a growth company, and iii) Demonstration effect: The success of the project would demonstrate economic viability of water sector projects in the Frontier regions, thereby; attract private sector investors in this nascent sector.

This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects. Epure has provided information on its current practices and policies that seek to address environmental and social risks and impacts to ensure that the proposed project complies with or, will upon implementation of measures agreed upon as part of IFC’s Investment documents, comply with host country laws and regulations and IFC''s Performance Standards (PS). The principal environmental and social risks identified for the project which will require additional mitigation measures by Epure include implementation of a comprehensive environmental and social management system, oversight of subcontracted labor, occupational health and safety, emissions to the environment, emergency response and community engagement. Going forward, as a condition of disbursement, the Company has adopted IFC environmental and social Performance Standards as part of the applicable legal and other requirements in its management system, including formal procedures for environmental and social screening of business opportunities and new projects into its marketing strategy, commercial planning, and project bidding processes. This is IFC''s third corporate investment in the Sound Global Group, and IFC’s review has confirmed that the Company continues to manage its environmental social, health and safety (ESHS) performance of existing operations effectively and addressing potential ESHS impacts of new projects in a manner that is consistent with IFC’s Performance Standards.