Cellcom Israel Announces 4G Network Sharing Agreement

NETANYA, Israel, May 25, 2014 /PRNewswire/ -- Cellcom Israel Ltd. (NYSE: CEL) (TASE: CEL) (hereinafter: the "Company"), announced today that subsequent to the network sharing policy published by the Israeli Minister of Communications, the Company entered a network sharing agreement with Golan Telecom Ltd., under which Golan will be provided an Indefeasible Right of Use, or IRU, to the Company's future 4G radio network, generally for at least 5 years and 9 months and for as long as it is used by the Company. Each of the Company and Golan will provide the required frequencies for the operation of the 4G radio network and purchase and operate their own core network. The Agreement is subject to the Antitrust Commissioner and the Ministry of Communications' approvals to both this Agreement and to the parties' previous agreement under which Golan is provided an IRU to the Company's 2G and 3G radio networks, or 2G 3G IRU Agreement.  

The annual revenues to the Company from both IRU agreements, if approved, are expected to be at a similar level to those generated from the parties' existing national roaming agreement in 2013. As previously reported, the 2G 3G IRU agreement, if approved, will replace the national roaming agreement.

The Company continues its efforts at further network sharing, including the sharing of passive elements of cell sites for existing networks, which the Company expects to generate future  savings in both operating expenses and capital expenditures.

For additional details see the Company's most recent annual report for the year ended December 31, 2013 on Form 20-F, filed on March 6, 2014, under "Item 3. Key Information – D. Risk Factors – Risks Related to our Business – We face intense competition in all aspects of our business" and "Item 4. Information on The Company – B. Business Overview – Network and Technology - Network and Cell Sites Sharing Agreements", the Company's immediate report regarding the Company's results of operation in the first quarter of 2014 on form 6-K dated May 14, 2014, under "Other developments during the first quarter of 2014 and subsequent to the end of the reporting period— Network Sharing Agreements" and the company's immediate report on form 6-K dated May 18, 2014.

Forward looking statement

The information included in this press release contains, or may be deemed to contain, forward-looking statements (as defined in the U.S. Private Securities Litigation Reform Act of 1995 and the Israeli Securities Law, 1968). Said forward-looking statements, relating to the execution of such agreements and the benefits therefrom, are subject to uncertainties and assumptions about the receipt of the necessary approvals, the parties' ability to receive the required frequencies to operate a 4G network, the costs thereof and the 4G radio network roll out. The actual conditions the Company may face could lead to materially different outcome than that set forth above.

About Cellcom Israel

Cellcom Israel Ltd., established in 1994, is the largest Israeli cellular provider; Cellcom Israel provides its approximately 3.049 million subscribers (as at March 31, 2014) with a broad range of value added services including cellular and landline telephony, roaming services for tourists in Israel and for its subscribers abroad and additional services in the areas of music, video, mobile office etc., based on Cellcom Israel's technologically advanced infrastructure. The Company operates an HSPA 3.5 Generation network enabling advanced high speed broadband multimedia services, in addition to GSM/GPRS/EDGE networks. Cellcom Israel offers Israel's broadest and largest customer service infrastructure including telephone customer service centers, retail stores, and service and sale centers, distributed nationwide. Through its broad customer service network Cellcom Israel offers technical support, account information, direct to the door parcel delivery services, internet and fax services, dedicated centers for hearing impaired, etc. Cellcom Israel further provides through its wholly owned subsidiaries internet connectivity services and international calling services, as well as landline telephone communication services in Israel, in addition to data communication services. Cellcom Israel's shares are traded both on the New York Stock Exchange (CEL) and the Tel Aviv Stock Exchange (CEL). For additional information please visit the Company's website www.cellcom.co.il

SOURCE Cellcom Israel Ltd.