JULY 2008

Severstal to acquire WCI Steel

Severstal announced that it has reached a binding agreement to purchase WCI Steel, based in Warren, Ohio.

According to the terms of the agreement, Severstal will acquire all outstanding equity of WCI for a total cash consideration of US$140 million, implying an enterprise value of US$331 million based on outstanding net debt as of April 30, 2008. The transaction is expected to be immediately accretive to earnings.

WCI’s board of directors has recommended the transaction to its shareholders. Shareholders representing a majority of WCI’s diluted shares outstanding have consented to the transaction.

The acquisition has the support of the United Steel Workers (USW).

Together with Severstal’s current United States operations in Dearborn, Michigan, Columbus, Mississippi, and the recently acquired Sparrows Point in Baltimore, Maryland, WCI will grow the Company’s North American leadership in the high-quality flat-rolled steel segment for the automotive, appliance, furniture, construction and energy markets.

The acquisition is expected to close by early in third quarter of 2008.