NOVEMBER 2008

General Steel acquires Yantai Steel

General Steel Holdings, Inc., a non-state owned steel products producer in China, has signed a letter of intent to acquire 80 percent of Yantai Steel Pipe Co.

Upon completion of the proposed acquisition, Yantai Steel Pipe will become a Chinese-foreign joint venture, for which General Steel will have 80 percent ownership interest and Laiwu Iron & Steel Group will have 20 percent ownership interest.

The joint venture will preserve the existing systems of Yantai Steel Pipe and build a new production line for hot rolling seamless pipe. The production capacity of the joint venture is designed to be 500,000 to 600,000 tons annually. The main products of the joint venture include oil pipe, boiler pipe, hydraulic pipe and those used in mechanical structures.

Yantai Lubao Steel Pipe Co., Ltd, a subsidiary of Yantai Steel Pipe, is owned 20.18 percent by Yantai Steel Pipe and 79.82 percent by Baosteel Group Corporation.