Further to the immediate report of Koor Industries Ltd. ("the Company") on February 11, 2014 (Ref. 2014-01-037363) concerning the merger transaction between the Company and Discount Investments Ltd. ("DIC" and "the Merger Transaction", respectively) and the timetable set by the court in its decision on approval of the distribution as described in the aforementioned report, the Company is making preparations for closing the Merger Transaction on Sunday, March 2, 2014. As of today's date, it is not certain that the Merger Transaction will indeed be closed on that date. The Company will continue to update the authorities on the matter and will report on the expected closing date before the closing takes place, coordinated with the Tel Aviv Stock Exchange Ltd.

It is further noted that as part of preparation of the financial statements of the Company as of December 31, 2013, which has not yet been completed, a draft economic valuation updated to December 31, 2013 was forwarded to the Company, of the embedded derivative in a non-recourse loan which the Company received from Makhteshim-Agan and ChemChina as part of the Merger Transaction ("the Makhteshim-Agan Option"), and of the depreciated cost of the host contract in the mixed instrument in respect of the non-recourse loan. According to the draft valuation, there are indications of a decrease in the fair value of the Makhteshim-Agan Option to approximately NIS 607 million compared to the fair value of NIS 695 million on September 30, 2013, and of a decrease in the value of the depreciated cost of the host contract in the mixed instrument in respect of the non-recourse loan to approximately NIS 3,675 million compared to a value of NIS 3,788 million on September 30, 2013. It is clarified that as of today's date, the valuation is a draft only, which might change since it is not yet complete and has not been signed, and certainly has not yet been discussed or approved by the competent Company organs. It is also emphasized that a decrease in the value of the Makhteshim-Agan Option as of December 31, 2013 does not affect the value of Koor that was determined for the Merger Transaction and accordingly, does not affect the amount of the merger consideration that will be transferred to the eligible shareholders as part of the closing of the Merger Transaction. The consideration of the merger was set in accordance with the terns of the Merger Transaction, as the Company reported, inter alia, in the immediate report of August 10, 2013, as amended on September 10, 2013 (Ref: 2013-01-142278).

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