-1-

The Semi-Annual Financial ConferenceThe Association of Publicly Traded Companies and DC Finance

Ronit Harel Ben-Ze’ev, Senior Vice President

Tel-Aviv Stock ExchangeNovember 2006

Going Public – Where and When

-2-

TASE – No. of New Companies(Equity raised in NIS millions)

2004 2005 1-9/2006

R&D and Hi-Tech companies

-- 7(349)

13(355)

Biomed

(Out of the above)

-- 5(179)

8(259)

Other Companies 20(1,661)

17(2,021)

13(1,594)

Total 20(1,661)

24(2,370)

26(1,949)

-3-

The Home Market – 2 Alternatives:

1. IPO on the TASE

2. Dual Listing on the TASE – Following an IPO on U.S. Markets or LSE (official list).

-4-

1. IPO on the TASE• A leverage towards an offering abroad.

• Timing – raise when you can (exiting in stages)

• Low costs and a quick process.

-5-

IPO CostsIPO Costs(1)(1) ($k) ($k)

Fixed costs (2) 1,475 1,365 155

Variable costs:Underwriting, distribution

3,500 2,500 2,500

Total 4,975 3,865 2,655

(1) $ 50 mil offering(2) , Lawyers, CPA, printing, fees, PR, etc.

-6-

Annual Costs ($k)Annual Costs ($k)

General costs (2) 1,800 822 260

D&O insurance 250 50-60 20

Class actions (estimate) 250 -- --

Total 2,300~ ~900 280

(1) Source: canaccordAsams, June, 2006(2) Lawyers, CPA, IR, PR, fees, shareholders meetings, payments and options for directors

)2( )2(

-7-

• A jumping board to offering abroad.

• Timing – raise when you can (exiting in stages)

• Low costs and a quick process.

• Special rules for R&D companies.

1. IPO on the TASE

-8-

Special rules for R&D companies *• Post-IPO equity: At least NIS 8 million• Minimal distribution of public float: 35 shareholders • Public float:

The public float (percent) must be at least

When the value of the public float is…

10.0 From 16

7.5 From 50

•R&D company: one that has invested at least NIS 3 million in R&D in the last three years, including funds raised from the Chief Scientist.

-9-

Listing Procedures (excluding R&D companies)

Procedure 1 Procedure 2 Procedure 3

Shareholders' equity after listing

25 35 --

Public-float value 20 30 80

Period of activity 12 months 12 months --

Added value in the 12 months preceding listing

4 -- --

Value of issue -- -- 80

Value of the company's shares

-- -- 200

-10-

• A jumping board to offering abroad.

• Timing – raise when you can (exiting in stages)

• Low costs and a quick process.

• Special rules for R&D companies.

• Tel-Tech Index, Bio-Med (in process) and other TASE

indices

• Dual listing law – following listing on U.S markets.

1. IPO on the TASE

-11-

36 Israeli companies have dual-listed on the TASE since the dual-listing law was enacted

– 2 companies, Partner and Perrigo, are included in the TA-25 Index

– 9 companies are included in the Tel-Tech 15 Index

– 14 companies are included in the TA-100 index

12 additional companies are traded both in Tel Aviv and the U.S.

2 .Dual Listing

-12-

• More IsraeliMore Israeli investors - institutional and individual.

• Index funds (TA 25, TA 100 and Tel-Tech funds).

• TA-25 companies may benefit from trading in index-options.

• Raising money on TASE (Partner).

• The home market benefit– Blue-chip prominence on the TASE– Greater familiarity and exposure

• 13-hour continuous trading from 10:00 a.m. to 11:00 p.m., local time

• Options can be exercised by employees easily and at low cost

The Benefits of Dual Listing

-13-

Some FiguresMarket

Capitalization (Millions of Shekels)

September 30, 2006

Portion of TASE Trading Volume

1-9/2006

Average Daily Trading Volume on

TASE – 1-9/2006(Thousands of Shekels)

Perrigo 3/2005 6,951 29% 7,458

Partner Communication 7/2001 6,567 88% 13,777

Given Imaging 3/2004 2,272 24% 1,922

Blue Square Israel 11/2000 1,982 93% 1,214

Alvarion 7/2001 1,663 16% 2,132

AudioCodes 10/2001 1,643 20% 1,954

Radware 5/2004 1,158 14% 1,174

Aladdin 7/2004 1,072 20% 1,129

Shamir Optical 5/2005 663 41% 250

XTL (London) 7/2005 228 63% 844

-14-

Ronit Harel Ben-Ze’ev, Senior VP

Listing and Economic Department

E-mail: harel@tase.co.il Phone: 5677424 – 03

New Website: New Website: www.tase.co.il www.tase.co.il

Thanks