Matav Receives Option to Participate in the Sale of Partner's Shares to Partner Communications Company

Matav Receives Option to Participate in the Sale of Partner's
Shares to Partner Communications Company 


NETANYA, Israel, Feb. 8  /PRNewswire-FirstCall/ -- Matav-Cable Systems Media
Ltd. (NASDAQ:MATV)(TASE:MATV) (hereinafter: "Matav") announced today that in
connection with an irrevocable offer made by Elbit Limited ("Elbit"), Eurocom
Communications Limited ("Eurocom") and Polar Communications Limited ("Polar")
to sell to Partner Communications Company Ltd. ("Partner";
(NASDAQ:PTNR)(TASE:PTNR)(LSE:PCCD)) approximately 31.7 million Partner shares,
representing their entire stakes in Partner (17.2% of Partner's outstanding
ordinary shares) for aggregate consideration of up to NIS1.0214 billion ($233.6
million), Matav was granted an option to participate together with Elbit,
Eurocom and Polar in the sale of Partner shares back to Partner. In the event
that Matav elects to participate in the sale, Matav will be able to sell to
Partner approximately 7.87 million Partner shares and the number of shares to
be sold by Elbit, Eurocom and Polar to Partner will be reduced proportionally
to the sellers' respective ownership percentage of Partner's shares. In the
event that Matav does not exercise its option to participate in the sale of
Partner shares together with Elbit, Eurocom and Polar, then for a period of 90
days following the closing of such sale, Matav will have an option to put
approximately 5.7 million of its Partner shares to Elbit, Eurocom and Polar in
the same sale price offered to Partner. In the event that Matav either
participates in the sale to Partner or exercises its option to put shares to
Elbit, Eurocom and Polar, Matav may recognize capital gains (net of tax impact)
of between approximately $28 million and $19 million (depending on the final
price at which Partner's shares will be sold and the relevant sale alternative
chosen by Matav).

The offer by Elbit, Eurocom and Polar is conditional upon the release of the
share pledges in favor of Partner's lending banks currently governing the
shares.  The acceptance of the offer by Partner will be subject to it obtaining
all corporate and regulatory consents and approvals required by law or
Partner's general license, including, among others:

  -- approval of Partner's audit committee, board of directors and
      shareholders, and
       -- the consent of the Ministry of Communications; and
       -- consent of the Antitrust authorities



The sale price formula offered to Partner reflects a 10% discount to Partner's
20 day volume weighted average market price prior to obtaining the approval of
Partner's shareholders, up to a maximum price of NIS32.22 per share but not
below NIS31.04 per share. This discount reflects the restricted nature of the
shares to be sold, including the fact that the shares are currently subject to
pledges in favor of Partner's lending banks and that they are subject to the
requirements of Partner's license and the long-standing shareholders agreement
between the founding shareholders.

Subject to all conditions to closing being satisfied, closing of the sale to
Partner is scheduled to occur no later than 80 days from the date of the offer.
There is no assurance that the sale to Partner will be consummated.

In certain circumstances, where Partner fails to buy back its shares as
described above, Elbit, Eurocom, Polar, Matav and Hutchison Telecommunications
International Limited ("Hutchison"; (NYSE:HTX)(SEHK:2332)) have agreed to a
"Fallback Plan" whereby  Elbit, Eurocom and Polar will be allowed to sell their
31.7m Partner shares into the market in coordinated sales.  Elbit, Eurocom and
Polar have granted an option to Hutchison whereby Hutchison can acquire up to
2% of the outstanding shares of Partner at a 12% discount to the then average
market price, and an additional right of first refusal to purchase up to 5.5%
of the outstanding share capital of Partner (or 7.5%, if Hutchison did not
exercise its 2% call option) at the same 12% discounted price.

Pursuant to the Fallback Plan, Elbit, Eurocom and Polar have granted Matav a
90-day option enabling Matav to put approximately 7.4 million of its Partner
shares to Elbit, Eurocom and Polar, pro rata to their respective shareholding
of Partner, in a manner that would enable Matav to be in the same position had
Matav elected to participate in the Fallback Plan in the first place. There is
no assurance that the Fallback Plan will be consummated.

About Matav:

Matav is one of Israel's three cable television providers, serving roughly 25
percent of the population. Matav's current investments include 5.3 percent of
Partner Communications Ltd., a GSM mobile phone company and 10 percent of Barak
I.T.C. (1995) Ltd., one of the three international telephony providers in
Israel.

This press release contains forward-looking statements within the meaning of
the "safe harbor" provisions of the U.S. Private Securities Litigation Reform
Act of 1995. Forward-looking statements that are based on various assumptions
(some of which are beyond Matav's control) may be identified by the use of
forward-looking terminology, such as "may," "can be," "will," "expects,"
"anticipates," "intends," "believes," "projects," "potential," "are
optimistic," "view" and similar words and phrases. Actual results could differ
materially from those set forth in forward-looking statements due to a variety
of factors, including but not limited to (1) changes in technology and market
requirements, (2) decline in demand for the company's products, (3) inability
to timely develop and introduce new technologies, products and applications,
(4) loss of market share and pressure on pricing resulting from competition,
(5) uncertainty as to the completion of acquisition of new businesses or
operations and integration thereof with Matav's business, and (6) the other
risk factors detailed in Matav's most recent annual report and other filings
with the US Securities and Exchange Commission. Matav undertakes no obligation
to publicly release any revisions to these forward-looking statements to
reflect events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events.

   Contacts:
   Ori Gur Arieh, Counsel
   Matav-Cable Systems Media Ltd.
   Tel.: [phone]

   Ayelet Shiloni
   Integrated Investor Relations
   Tel.: [phone]
   Tel: [phone]
   

DATASOURCE: Matav-Cable Systems Media Ltd.



CONTACT: Ori Gur Arieh, Counsel of Matav-Cable Systems Media Ltd.,

[phone]; or Ayelet Shiloni of Integrated Investor Relations,

[phone], [phone], , for Matav-Cable

Systems Media

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