Packaging

Cimatron Announces the Increase of its Holdings in Microsystem to 100%

Monday 14. July 2008 - Cimatron Limited (NASDAQ: CIMT), a leading provider of integrated CAD/CAM solutions for the toolmaking and manufacturing industries, today announced that its board of directors approved the exercise of Cimatron's previously disclosed second call option to acquire an additional 49% of the shares of Microsystem Srl, the company's Italian distributor, for an exercise price of approximately US$1,250,000, and accordingly, to increase Cimatron's holding in Microsystem from 51% to 100%.

The exercise price was already included in Cimatron’s current liabilities as of December 31, 2007. The acquisition is scheduled to close in the second half of July, 2008.

Commenting on the news, Danny Haran, President and Chief Executive Officer of Cimatron, said, “The increase in our holding in Microsystem to 100% is the final stage of our investment in Microsystem, that was meant to strengthen our leading position in Italy, one of our key markets in West Europe. We have worked closely with Microsystem’s management and staff since we acquired 27.5% of its shares in 2005, and we already see the benefits for both companies’ customers and employees. We have consolidated Microsystem’s results in our financial statements since Q3 2007, when we increased our holding to 51%, hence the increase to 100% is not expected to change the way we are currently reporting this holding in our financial statements.”