Tefron in Discussions to Establish a Joint Venture in Egypt

MISGAV, Israel, June 16 /PRNewswire-FirstCall/ -- Tefron Ltd. (OTC:TFRFF;
TASE:TFRN), a leading producer of seamless intimate apparel and
engineered-for-performance (EFPTM) active wear, announced that it is
currently in advanced negotiations with a number of third parties to
establish a joint venture in Egypt ("JV") to manufacture products on behalf
of the Company's customers. The JV would be established through an Egyptian
company ("Tefron Egypt") in which the Company will hold a 50% interest and
the remaining interests would be held by three other partners.
Under the proposed arrangement, Tefron would transfer to Tefron Egypt
equipment with a value of approximately US $1 million and the other partners
would invest in Tefron Egypt approximately US $1 million in cash that would
be used for investments and working capital required to commence the
activities of Tefron Egypt. In addition, Tefron Egypt would acquire
additional services from the company.
It should be emphasized that there is no guarantee that the JV will be
established or that the negotiations among the parties will lead to a binding
agreement for the establishment of the JV.
About Tefron
Tefron manufactures boutique-quality everyday seamless intimate apparel,
active wear and swimwear sold throughout the world by such name-brand
marketers as Victoria's Secret, Nike, Target, The Gap, J.C. Penney,
Maidenform, lululemon Athletica, Warnaco/Calvin Klein, Patagonia, Reebok,
Swimwear Anywhere, Abercombie&Fitch, and El Corte Englese, as well as other
well known retailers and designer labels. The company's product line includes
knitted briefs, bras, tank tops, boxers, leggings, crop, T-shirts, nightwear,
bodysuits, swimwear, beach wear and active-wear.
This press release contains certain forward-looking statements, within
the meaning of Section 27A of the US Securities Act of 1933, as amended,
Section 21E of the US Securities Exchange Act of 1934, as amended, and the
safe harbor provisions of the US Private Securities Litigation Reform Act of
1995, with respect to the Company's business, financial condition and results
of operations.
Words such as "believe," "anticipate," "expect," "intend," "will,"
"plan," "could," "may," "project," "goal," "target," and similar expressions
often identify forward-looking statements but are not the only way we
identify these statements. Except for statements of historical fact contained
herein, the matters set forth in this press release regarding our future
performance, plans to increase revenues or margins and any statements
regarding other future events or future prospects are forward-looking
statements.
These forward looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from those contemplated
in such forward-looking statements, including, but not limited to:
- the effect of the worldwide recession on our sales to our customers in
the United States and in Europe and on our ability to finance our
operations;

- our customers' continued purchase of our products in the same volumes
or on the same terms;

- the failure of any of our principal customers to satisfy its payment
obligations to us;

- the cyclical nature of the clothing retail industry and the ongoing
changes in fashion preferences;

- the competitive nature of the markets in which we operate, including
the ability of our competitors to enter into and compete in the
seamless market in which we operate;

- the potential adverse effect on our business resulting from our
international operations, including increased custom duties and import
quotas (e.g., in China, where we manufacture for our swimwear division)

- fluctuations in inflation and currency rates;

- the potential adverse effect on our future operating efficiency
resulting from our expansion into new product lines with more
complicated products, different raw materials and changes in market
trends;

- the purchase of new equipment that may be necessary as a result of our
expansion into new product lines;

- our dependence on our suppliers for our machinery and the maintenance
of our machinery;

- the fluctuations costs of raw materials;

- our dependence on subcontractors in connection with our manufacturing
process

- our failure to generate sufficient cash from our operations to pay our
debt;

- political, economic, social, climatic risks, associated with
international business and relating to operations in Israel;

As well as certain other risks detailed from time to time in the
Company's filings with the Securities and Exchange Commission. The Company
undertakes no obligation to publicly release any revisions to these
forward-looking statements to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.
Contacts
Company Contact:
Eran Rotem
Chief Financial Officer
+972-4-990-0803
reran@tefron.com

SOURCE Tefron Ltd

Contacts: Company Contact: Eran Rotem, Chief Financial Officer,
+972-4-990-0803, reran@tefron.com