PAN Farm

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The proposed investment is to subscribe for an equity stake with an estimated consideration of up VND 230 billion (approximately US$10 million) in common shares of in Pan Farm JSC, a Vietnamese farming company held by an IFC’s existing IS & AS client, The Pan Group (#34305, the “Group”) which is a listed agribusiness conglomerate with market capitalization of $186 million as of August 9, 2016. The Group Established Pan Farm in July 2016 with the vision to grow to become a leading integrated agricultural supplier in Vietnam, which focuses on providing high quality farming inputs and solutions to farmers, and meeting the growing demand for traceable and safe agricultural products at domestic and international level. Pan Farm owns 75% of National Seed Corporation (“NSC”), the largest producer and distributor of crop seeds in Vietnam and 64% of Pan-Saladbowl JSC (“Pan-Saladbowl”), a greenfield horticulture grower of high quality flowers for export to Japan. The proposed investment will support the horizontal integration of NSC, the development of new agricultural products such as fruits and vegetables through joint ventures with international strategic partners and the expansion of Pan-Saladbowl.NSC, as part of the Pan Group, was appraised and included as part of the 2014 (#34305, the “Group”) IFC investment. NSC is a producer and distributor of conventional rice, hybrid rice, glutinous corn, yellow corn and vegetable seeds, and will integrate Southern Seed Company (SSC) into this operation. NSC is considered northern Viet Nam’s main seed supplier of certified seeds to the farming sector cultivating seeds through a network of 9,000 out-growers and, marketing through 1,500 distributors. NSC maintains 11 facilities for warehousing and sales of seeds, with 2 processing and 2 research facilities and laboratories where it develops and tests new seed varieties. SSC mirrors NSC operations with a geographic focus in southern Viet Nam. This division of companies enables seed varieties to be produced that match the growing conditions and climate of the whole country.Pan Group has been subject to an ongoing Environment and Social Action Plan (ESAP) and to date has demonstrated satisfactory performance in implementation. The Group published its first Sustainability Report (referred to as “Sustainability Report (2015)”) in accordance with Global Reporting Initiatives (GRI) guidelines and has appointed a group level coordinator for Sustainability based in its Ha Noi headquarters.