Further to announcements by Koor Industries Ltd (‘the Company”) on March 24 and 25, 2008, and April 21, 2008, and reports in the media today, the Company makes the following announcement:

As the Company reported on March 24, 2008, the Company’s Board of Directors authorized the Company’s management to make tradable investments in the shares of European financial institutions.

To date the Company has signed an agreement with Goldman Sachs for the provision of a recourse line of credit, and is about to sign with Goldman Sachs in the coming days on an additional, non-recourse agreement. Upon signature of the second agreement, the credit facility available to the Company will increase to USD 1.5 billion (of which USD 820 million are non-recourse). Together with its own capital that the Company will be required to invest, if the credit facilities are fully utilized, the investment in these shares could reach USD 2.7 billion.

As the Company has reported, to date the Company’s Board of Directors has approved so far an investment in an amount of NIS 1.5 billion. At this stage shares have been purchased in insignificant numbers in Barclays Bank alone. Use of the credit facility and an increase in the Company’s investments in shares are dependent on several conditions, including the Company’s assessment of market developments. The Company wishes to clarify that there is no certainty as to the carrying out of investments or their scope.