Israel Petroleum to Acquire Shaldieli

Israel Petroleum has signed an agreement to acquire the publicly listed Israeli company Shaldieli in a reverse takeover. IPC will place its ownership interests in the Myra and Sara drilling licenses offshore Israel – owned through a limited partnership - into the Company, which currently has no assets or liabilities, in exchange for 90% ownership of the Company and a controlling interest therein. The transaction is expected to close at the end of November, subject to regulatory approval and requisite approval of corporate organs. The prospectus for the transaction is expected to be filed with the Israel Securities Authority by November 4, 2010.

Shaldieli is listed on the Tel Aviv Stock Exchange under the symbol SLDL.IT. It has been inactive but is now approved for unrestricted trading. After the acquisition, a total of approximately 144.8 million shares will be issued to IPC. For tax reasons, IPC will be required to hold these shares for two years. Howard Cooper, currently the manager of IPC through his company International Three Crown Petroleum LLC, will be the Chairman and President of the Company following the closing. IPC will appoint three board members for the five-member board. IPC currently owns 50% of IPC Oil and Gas (Israel) Limited Partnership ("IPC Israel"), which owns a 13.609% interest in the Sara and Myra licenses. Under the agreement with Shaldieli, IPC will exchange its 50% ownership in IPC Israel for ownership of 90% of the shares of Shaldieli, and Shaldieli will acquire ownership of IPC's 50% interest in IPC Israel. Also, Shaldieli will hold 50% interest in the general partner of IPC Israel along with an entity owned by Ofer Investments Ltd., the owner of the other 50% of IPC Israel under the agreement announced last week between IPC and Ofer Investments, Ltd.


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