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SREI Inf Fin Ltd (SRI)

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Wednesday 06 June, 2007

SREI Inf Fin Ltd

Re Agreement

SREI Infrastructure Finance Limited
06 June 2007



          SREI INFRASTRUCTURE FINANCE and BNP PARIBAS LEASE GROUP
           
                            FORM 50:50 JOINT VENTURE



                           BPLG to invest Rs 775 Crore


Mumbai, May 31, 2007


SREI INFRASTRUCTURE FINANCE LIMITED ('SREI'), a leading Non Banking Financial
Institution with special focus on the infrastructure sector since 1989 and BNP
Paribas Lease Group ('BPLG'), the leasing arm of BNP Paribas, have reached an
agreement regarding a strategic partnership in equipment finance in India.

The partners will bring their respective expertise and know-how as well as
combine the strength of the SREI brand and the local expertise of SREI with the
specialized equipment finance skills and global brand strength of BPLG, in order
to further develop the equipment finance business.

Mr. Hemant Kanoria, Vice Chairman and Managing Director of SREI, termed this joint
venture as a very significant step in the Indian Financial Services Market. 'We
are the largest player in the financing of infrastructure equipment and
collaborating with BPLG will help in increasing our market share further and
also expanding the product line into financing of agriculture, information
technology, medical and other equipment.'

Speaking at the occasion Mr. Bertrand Gousset, member of the Executive Committee
of BPLG, in charge of Corporate Development, said, 'We are delighted to be
associated with the SREI group, who are the leaders in the financing of
infrastructure equipment and provide a wide range of equipment finance products
to large strategic clients as well as to retail customers, with pan-India
coverage. This joint venture is very significant for us and we look forward to a
long and prosperous association with them.'

Mr Sunil Kanoria said, 'This joint venture signifies the coming together of two
companies with the same shared values. Both SREI and BPLG are convinced that
they are well positioned to build on the already strong platform established by
SREI and that this will enable in reduction in cost of funds resulting in higher
profitability.'

Mr. Amoudru, CEO of BNP Paribas India and Head of Territory, said 'The
acquisition of a 50% stake in this joint-venture with SREI - a highly recognised
firm in equipment and infrastructure financing - further evidences the
willingness of the BNP Paribas Group to expand its presence in India in
activities where it has a strong expertise. It represents another substantial
capital commitment from the Group- the largest so far- in this country and
testifies our confidence in the long term prospects of the Indian economy'.

Subject to necessary regulatory approvals and statutory consultation, the
alliance will involve a new Joint Venture Company, equally owned by each of SREI
and BPLG. The current infrastructure equipment (asset finance) business of SREI
along with its insurance broking activity will be transferred to this JV. 

SREI is a Non Banking Financial Institution, with special focus on the
infrastructure sector since 1989. Pursuant to the transaction, SREI proposes to
focus on infrastructure project finance, fund management, investments, advisory
and development business including the equipment bank, Quipo. This transaction
should help SREI in enhancing shareholder value and also address the continuous
need for capital. Indeed, the Joint Venture that is being formed with an initial
net worth of Rs. 800 Crores would not only strengthen its ability to grow its 
business manifold but also free the net worth of the SREI associated with the 
transferred business and thus increasing its ability to grow its other 
businesses. Moreover, the partnership with BPLG should help the Joint
Venture Company in lowering its cost of funds for the asset finance business as
well as in strengthening its core activities and its position in the sector.

BNP Paribas Lease Group (BPLG) is a 100% BNP Paribas subsidiary specialized in
financing investments made by companies and professionals, either through the
intermediary of its partners (manufacturers, importers and vendors of equipment)
or directly to the customers. BNP Paribas Lease Group has been in this business
for 50 years and is today the European and French market leader with a global
balance sheet of 15 billion Euros. BNP Paribas Lease Group is present in
Austria, Belgium, France, Germany, Hungary, Italy, the Netherlands, Poland,
Portugal, Spain and the UK. For further information, see www.bplg.com

SREI had Kotak Investment Banking as their exclusive financial advisor while
BPLG has been exclusively advised by Ambit Corporate Finance. 



For further information please contact:


Subhash Mohanti 
Vice President (Communication and Brand Development)
Srei Infrastructure Finance Limited
Phone: +91-9330902070 
Email: [email protected]
www.srei.com


Christelle Maldague 
Communication Group
BNP Paribas
Phone: +33 1 42 98 56 48 
Email: [email protected]




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