Kardan N.V. — M&A Activity 2011

Jun 16, 2011

KARDAN TO SELL RUSSIAN BANKING ACTIVITIES FOR MORE THAN TWO TIMES EQUITY

Amsterdam, June 16, 2011 – Kardan N.V. ("Kardan"), active in Real Estate, Water Infrastructure and Financial Services in emerging markets announces that the group's retail lending subsidiary, TBIF Financial Services B.V. ("TBIF"), signed an agreement (the "Agreement") to sell its 50% stake in the Russian banking business (the "Bank") to the other shareholder in the Bank ("the Transaction").

The structure of the Transaction envisages an initial payment of approximately EUR 40 million within a month from signing, subject to certain conditions, with the remainder of the price due on completion, expected by June 2012. Completion is subject to various conditions precedent and until completion TBIF continues to fully exercise its joint-control rights in the Bank.

The total consideration for the Transaction, including initial payment, dividends, last instalment and interest due on the last instalment, is approximately EUR 123 million, reflecting a multiple of more than two times equity based on March 31, 2011 shareholder"s equity of the Bank. Over the years, Kardan invested approximately Euro 100 million in the Bank. This sale, together with last year"s sale of a 16% interest in the Bank, generates accumulated proceeds of approximately Euro 160 million for Kardan.

The sale of the Bank is in line with Kardan"s strategy to create value and to realize returns by, among others, exiting its investments when deemed appropriate. The decision of TBIF to sell its stake in the Bank is based on the value of the Transaction, which represents an attractive offer for a Russian consumer bank in today's environment.

The accounting implications of the Transaction are still under investigation. However, based upon the positions as of March 31, 2011 and as a result of IFRS 3R according to which the 50% holding in the Bank was fully marked to fair value based upon the sale of 16% of the Bank in September 2010 (resulting in a capital gain of over EUR 50 million in 2010) and accounting for Kardan"s share in the profits of the Bank since then, the book value of the Bank for Kardan exceeds the value derived from this Transaction by approximately EUR 10 million. Consequently, Kardan is expected to record a loss of this amount in the form of goodwill and other intangible asset amortization.

DISCLAIMER

This press release contains forward-looking statements and information, for example concerning the financial condition, results of operations, businesses and potential exposure to market risks of Kardan N.V. and its group companies ("Kardan Group").All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements (including "forward looking statements" as defined in the Israeli Securities Law).. Forward-looking statements are statements of future expectations that are based on management"s current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. These forward-looking statements are identified by the use of terms and phrases such as ""anticipate"", ""believe"", ""could"", ""estimate"", ""expect"", ""intend"", ""may"", ""plan"", ""objectives"", ""outlook"", ""probably"", ""project"", ""will"", ""seek"", ""target"", ""risks"", ""goals"", ""should"" and similar terms and phrases. A variety of factors, many of which are beyond Kardan Group"s control, affect our operations, performance, business strategy and results and could cause the actual results, performance or achievements of Kardan Group to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. For Kardan Group, particular uncertainties arise, amongst others but not limited to and not in any order of importance, (i) from dependence on external financing with the risk that insufficient access to capital threatens its capacity to grow, execute its business model, and generate future financial returns (ii) from concentration of its business in Central Eastern Europe and China as a result of which Kardan Group is strongly exposed to these particular markets (iii) from risks related to the financial markets as a result of Kardan"s listings and (iv) from it being a decentralized organization with a large number of separate entities spread over different geographic areas in emerging markets, so that Kardan Group is exposed to the risk of fraudulent activities or illegal acts perpetrated by managers, employees, customers, suppliers or third parties which expose the organization to fines, sanctions and loss of customers, profits and reputation etc. and may adversely impact Kardan"s ability to achieve its objectives and (v) from any of the risk factors specified in Kardan"s Annual Report 2010 and in the "Periodic Report for 2010"published by Kardan N.V. in Israel on March 31, 2011 and which is also available at the

Kardan website. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in the relevant forward-looking statement as expected, anticipated, intended, planned, believed, sought, estimated or projected. Kardan N.V. does not intend or assume any obligation to update or revise these forward-looking statements in light of developments which differ from those anticipated.

About Kardan

Kardan identifies and develops assets in promising emerging markets, mainly in Central and Eastern Europe, China and CIS. Its activities are mainly focused on three sectors that benefit from the rising middle class: Real Estate, Water Infrastructure and Retail Lending. In addition, the company has some investment activities in Israel. Company headquarters are in the Netherlands. Kardan aims at holding controlling interests in its investments and, through the development of local business platforms, is actively involved in the definition and implementation of their strategy. Total assets as of March 31, 2011 amounted to EUR 5.6 billion; revenues totaled EUR 181 million in the first quarter of 2011. Kardan is listed on NYSE Euronext Amsterdam and the Tel-Aviv Stock Exchange.

For further information please contact:

Jan Slootweg Management Board member Kardan N.V. Office +31 (0)20 305 0010

or

Caroline Vogelzang Director Investor Relations +31 (0)20 305 0010 Vogelzang@kardan.nl

www.kardan.nl

"This press release contains regulated information (gereglementeerde informatie) as defined in the Dutch Act on Financial Supervision (Wet op het financieel toezicht)"