Israeli company buys majority share of Yahala Arabic language Internet portal

Internet Gold Acquires 51% of Yahala, Leading Israeli Arab-Language Portal

PETACH TIKVA, Israel, March 22

Internet Gold, (Nasdaq NMS: IGLD) today announced that its fully-owned subsidiary Gold Mind has signed an agreement to acquire 51% of the shares of Yahala Ltd., the operator of yahala.co.il, one of Israel's largestArab-language portals. According to the agreement, Nizar Hori, Yahala's founder, will continue to hold Yahala's remaining shares and serve as its CEO, while Eli Holtzman, Internet Gold's CEO, will become Yahala's Chairman.

Yahala is a popular Internet portal that offers a rich variety of content and services to Israel's Arab-speaking sector, a segment that accounts for approximately 20% of Israel's population or 1.5 million individuals. Penetration of Internet access into the Arabic sector has been significantly lower than that of the Hebrew-speaking sector, but has been growing significantly during the past 12 months.

Internet Gold intends to integrate Yahala into its Internet Smile. Media Group with the goal of taking full advantage of the potential operating synergies between Yahala and its other portals.

Commenting on the news, Eli Holtzman, CEO of Internet Gold, said, "This acquisition is another step in our efforts to expand ourleadership position as Israel's largest Interactive Media Group. It reflects our expectation that Internet usage in the Arab sector will continue growing dramatically as it has during the past year, making the Arab population an important new target market for Internet advertising. We believe thatownership of an Arab-language portal may also help us identify additional investment opportunities in neighboring emerging markets."

About Internet Gold Internet Gold is a group of communications companies thatprovide Internet access and related value-added services, internationaltelephony, e-advertising, content and e-Commerce services throughout Israel under the brand name "smile". The broad range and popularity of these services have established Internet Gold as one of Israel's leading Internet Communications groups.

The Internet Gold Group includes four subsidiaries. MSN-Israel, its 50.1% owned joint-venture with Microsoft Corp. (49.9% owned), provides Microsoft-branded Search, Instant Messaging, Hotmail and a variety of portal services. Internet Gold International, a fully-owned subsidiary, provides internationalInternet and communication services. GoldMind, a fully-owned subsidiary,provides value-added services to Internet subscribers. GoldTrade, the Group'sfully-owned e-Commerce subsidiary, operates e-Commerce sites.

For additional information about Internet Gold, please visitits Website at www.igld.com.

Certain statements made herein that use the words "estimate,""project," "intend," "expect," "believe" and similar expressions are intendedto identify forward-looking statements within the meaning of the PrivateSecurities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks and uncertainties which could cause the actual results, performance or achievements of the Company to be materially different from those which may be expressed or implied by such statements, including, among others, changes in general economic and business conditions and specifically, decline in demand for the Company's services, inability totimely develop and introduce new technologies, services and applications and loss of market share and pressure on prices resulting from competition. Foradditional information regarding these and other risks and uncertaintiesassociated with the Company's business, reference is made to the Company'sAnnual Report filed with the Securities and Exchange Commission and its other reports as filed from time to time with the Securities and ExchangeCommission.

For further information, please contact: Marybeth Csaby KCSA Worldwide +1-212-896-1236 In Israel: Meirav Be'eri Investor Relations +972-3-516-7620Source: Internet GoldMarybeth Csaby, KCSA Worldwide, +1-212-896-1236. In Israel: Meirav Be'eri, Investor Relations, +972-3-516-7620