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Mon, January 31, 2011

Ampal-American Israel Corporation Debentures Placed on Watchlist by Midroog Ltd.


Published on 2011-01-31 02:20:22 - Market Wire
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TEL AVIV, Israel--([ BUSINESS WIRE ])--Ampal-American Israel Corporation (NASDAQ: AMPL) announced today that Midroog Ltd. (an affiliate of Moody's Investors Service) has placed Ampal's A3 rating for its Series A, Series B and Series C Debentures on its "Watchlista. Midroog announced that it took this action in light of the political and financial situation in Egypt, and the possible implications on East Mediterranean Gas Company S.A.E. (aEMGa) and its credit worthiness. Midroog noted that Ampal's 12.5% interest in EMG constitutes a substantial portion of Ampal's portfolio and is a substantial factor in Ampal's expected future cash flow.

Midroog also noted that EMG's stand as a natural gas supplier in Israel is mainly based on EMG's long-term contract with the Egyptian government for the purchase of natural gas from Egypt for the resale into the Israeli market through its pipeline between El-Arish and Ashkelon, and EMG's long-term contracts with several Israeli gas consumers, including Israel's Electric Company.

Midroog further noted that EMGa™s ability to purchase gas from Egypt is part of the peace treaty between Israel and Egypt, and, on the other hand, a risk factor related to EMG is its high dependence on the gas supply from the Egyptian governmental owned supplier and on the Egyptian government itself. Midroog stated that Ampal's ratings will also be further reviewed in light of any changes in the credit ratings of the state of Egypt.

Midroog further stated that the political situation in Egypt is uncertain at this point, as is its effect on EMG's and Ampal's businesses. Midroog noted it will continue to review the effect on Ampala™s business, taking into account (i) the extent to which EMG's contract with the Egyptian government continues to be honored, including its various terms and the continuity of gas flow from Egypt to Israel and (ii) the stability of EMG's ownership and control.

The gas supply from Egypt to Israel via EMG's pipeline has, to date, continued with no interruptions.

About Ampal:

Ampal and its subsidiaries acquire interests primarily in businesses located in the State of Israel or that are Israel-related. Ampal is seeking opportunistic situations in a variety of industries, with a focus on energy, chemicals, communications and related sectors. Ampala™s goal is to develop or acquire majority interests in businesses that are profitable and generate significant free cash flow that Ampal can control. For more information about Ampal please visit our web site at [ www.ampal.com ].

Safe Harbor Statement

Certain information in this press release includes forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934) and information relating to Ampal that are based on the beliefs of management of Ampal as well as assumptions made by and information currently available to the management of Ampal. When used in this press release, the words "anticipate," "believe," "estimate," "expect," "intend," "plan," and similar expressions as they relate to Ampal or Ampal's management, identify forward-looking statements. Such statements reflect the current views of Ampal with respect to future events or future financial performance of Ampal, the outcome of which is subject to certain risks and other factors which could cause actual results to differ materially from those anticipated by the forward-looking statements, including among others, the economic and political conditions in Israel, the Middle East, including the situation in Iraq, and the global business and economic conditions in the different sectors and markets where Ampal's portfolio companies operate. Should any of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results or outcome may vary from those described herein as anticipated, believed, estimated, expected, intended or planned. Subsequent written and oral forward-looking statements attributable to Ampal or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements in this paragraph. Please refer to the Ampal's annual, quarterly and periodic reports on file with the SEC for a more detailed discussion of these and other risks that could cause results to differ materially. Ampal assumes no obligation to update or revise any forward-looking statements.

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