Kardan N.V. — M&A Activity 2007

Oct 16, 2007

KARDAN N.V.

PRESS RELEASE

KARDAN ACQUIRES BOO CONCESSION FOR WATER SUPPLY AND WASTE WATER TREATMENT PLANTS IN SICHUAN PROVINCE

Amsterdam, 16 October 2007 – International investment company Kardan N.V. (Kardan) announces that its infrastructure subsidiary, Kardan Water International Group Ltd. (KWIG), part of Tahal Group B.V. (Tahal), signed an acquisition agreement for 100% of Tian He Project Company (Tian He) for a consideration of approximately EUR 1.8 million. Tian He owns Build-Own-Operate (BOO) concession agreements for water supply and waste water treatment plants in Dazhou City, Sichuan Province, China. The total investment of all phases is estimated at EUR 50 million.

KWIG will develop, operate and own, on exclusive basis, the water supply and waste water treatment plants in Dazhou City New Industrial Park. The New Industrial Park is built on one of China's largest scale natural gas fields. Targeted customers are large Chinese industrial groups such as China National Petroleum Corporation (SinoChem), the country's largest oil and gas producer and Sinopec Corporation, China's largest refiner.

The project is planned to be implemented in three phases. Phase one of the project is due to be completed in June 2008. The first phase has a designed capacity of 100,000 tons per day of industrial water supply and 20,000 tons per day of waste water treatment. The total investment of this phase is estimated at EUR 24 million. This capacity can be increased according to demand in the next phases to a total capacity of 300,000 and 50,000 tons per day for industrial water supply and waste water treatment respectively. The total investment of all phases is estimated at EUR 50 million.

Closing of the transaction is subject to regulatory approvals.

The signing of the acquisition agreement for Tian He is an important step in Tahal´s strategy to further develop its asset ownership activities and its plan to invest in selected projects in China relating to the development, management, operation and maintenance of water supply and waste water treatment infrastructure.

KWIG is a joint-venture between Tahal and a group of experienced local professionals active in the Chinese water industry. Tahal holds a 66.67% interest in KWIG.

Tahal is the holding company of the infrastructure activities of Kardan. Tahal operates internationally in the fields of investments, planning, design, construction and project management as well as in turnkey and 'build operate transfer' projects. Approximately 90% of the activities of Tahal are directly related to water and sewage systems.

About Kardan

Kardan is an international investment company with a focus on three sectors: Real Estate, Financial Services and Infrastructure. Kardan is primarily active in Central and Eastern Europe, where it conducts most of its activities. Kardan holds controlling interests in its main businesses and is actively involved in the definition and implementation of their strategy. Total assets per December 31, 2006 amounted to EUR 2.2 billion, with revenues of EUR 588 million. The number of employees engaged by the group is approximately 7,980 as of December 31, 2006. Kardan is listed on Euronext Amsterdam and the Tel-Aviv Stock Exchange.

For further information please contact:

Citigate First Financial	phone +31 (0)20 575 40 10
Claire Verhagen	mobile +31(0)6 5051 6325