Notice is hereby given that the Company's foreign subsidiary, Electech Real Estate B.V. (hereinafter: the "Subsidiary"), holding 50% of the rights in eight properties in the city of Berlin, Germany, has sold all its holdings in the properties. The principal details of the transaction are as follows:
• In December 2005 the Subsidiary purchased 50% of a portfolio comprising 9 properties in Germany, 8 of these in the city of Berlin, covering a total (100%) area of approx. 72,800 sq.m., at a total (100%) price, including expenses, in the sum of approx. € 41.7 M (approx. NIS 220 M).
• Of the aforesaid nine properties, the Subsidiary sold the eight properties in Berlin. 50% of the additional property, covering a total (100%) area of approx. 12,500 sq.m., still remains in its ownership.
• The total contribution from the sale of the above eight properties (100%), before expenses, is approx. € 75.5 M (approx. NIS 398.6 M), and less selling and related expenses, approx. € 73.5 M (approx. NIS 388.1 M).
• Of the said contirbution, € 14 M (approx. NIS 73.9) was placed on deposit, the accruals of which belong to the sellers, while the Subsidiary's share is € 7 M (approx. NIS 37 M). The sale agreement incorporates a mechanism for 7 years, pursuant to which the deposit will decrease upon satisfaction of certain conditions relating to the lease of currently vacant areas in the properties.
• The Subsidiary registered a liability in the sum of € 3 M (approx. NIS 15.8 M) for its share of this agreement, which was reflected in the results of the sale.
• The total anticipated capital gain (100%) before tax from the sale of the eight properties, after settlement of all costs related to execution of the sale transaction, is approx. € 30.8 M (approx. NIS 162.6 M) of which the Subsidiary's share of this gain is approx. € 15.4 M (approx. NIS 81.3 M).A profit of approx. € 14.3 M (approx. NIS 75.5 M) had already been accounted for within the framework of revaluations of assets performed by the Subsidiary in preceding reporting periods, and the balance of the profit, totaling approx. € 1.1 M (approx. NIS 5.8), will be registered in the Subsidiary's financial statements as at June 30, 2008.
• The total gross cash flow (100%) before tax, from the sale of the eight properties, after settlement of the loans in respect of all nine properties, and after placing the deposit set out above, and all other related expenses, is approx. € 27.5 M (approx. NIS 145.2 M), of which the Subsidiary's share is approx. € 15.1 M (approx. NIS 79.7 M).
• Furthermore, subsequent to the sale, the Subsidiary continues to hold 50% of the rights in the ninth property (which was not sold under the transaction). The value of the aforesaid property is registered at present in the Company's books at a value (100%) of approx. € 9 M (approx. NIS 47.5 M). After the transaction there are no longer any loans held against it.