Cellcom Israel Ltd. — Capital/Financing Update 2016

Mar 23, 2016

CELLCOM ISRAEL ANNOUNCES PRIVATE DEBENTURE OFFERING IN ISRAEL

Netanya, Israel – March 23, 2016 – Cellcom Israel Ltd. (NYSE: CEL) (TASE: CEL) (hereinafter: the "Company") announced today that pursuant to a private offering of additional debentures of the existing series I debentures, which are listed on the Tel Aviv Stock Exchange, or TASE, the Company accepted today (subject to the TASE's approval) orders from certain institutional investors for approximately NIS 246 million aggregate principal amount of additional Series I debentures, for a total consideration of NIS 250 million.

The price was set at NIS 101.5 for each Series I debenture of NIS 100 principal amount, reflecting an effective interest of 4.06% per annum. Accordingly, the debentures series I will be issued at a premium over the adjusted principal amount of the debentures (reflecting accumulated interest).

In relation to the said offering, the Company's rating agency reaffirmed the current rating of ilA+/stable for the Company and its debentures.

For additional details in regards to the existing debentures, see our most recent annual report for the year ended December 31, 2015 on Form 20-F, filed on March 21, 2016 under: "Item 5. Operating and Financial Review and Prospects – B. Liquidity and Capital Resources – Debt Service – Public Debentures."

The closing of the private offering is subject to the receipt of the Tel Aviv Stock Exchange's approval.

The offering described in this press release was made only in Israel and only to residents of Israel. The said debentures will not be registered under the U.S. Securities Act of 1933 and will not be offered or sold in the United States. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities.

About Cellcom Israel

Cellcom Israel Ltd., established in 1994, is the largest Israeli cellular provider; Cellcom Israel provides its approximately 2.835 million cellular subscribers (as at December 31, 2015) with a broad range of value added services including cellular telephony, roaming services for tourists in Israel and for its subscribers abroad and additional services in the areas of music, video, mobile office etc., based on Cellcom Israel's technologically advanced infrastructure. The Company operates an LTE 4 generation network and an HSPA 3.5 Generation network enabling advanced high speed broadband multimedia services, in addition to GSM/GPRS/EDGE networks. Cellcom Israel offers Israel's broadest and largest customer service infrastructure including telephone customer service centers, retail stores, and service and sale centers, distributed nationwide. Through its broad customer service network Cellcom Israel offers technical support, account information, direct to the door parcel delivery services, internet and fax services, dedicated centers for hearing impaired, etc. Cellcom Israel further provides OTT TV services (as of December 2014), internet infrastructure (as of February 2015) and connectivity services and international calling services, as well as landline telephone communication services in Israel, in addition to data communication services. Cellcom Israel's shares are traded both on the New York Stock Exchange (CEL) and the Tel Aviv Stock Exchange (CEL). For additional information please visit the Company's website www.cellcom.co.il.

Company Contact

Shlomi Fruhling Chief Financial Officer investors@cellcom.co.il Tel: +972 52 998 9755

Investor Relations Contact

Ehud Helft GK Investor & Public Relations In partnership with LHA cellcom@GKIR.com Tel: +1 617 418 3096