MOSCOW, May 16 /PRNewswire/ -- OAO Severstal (LSE: SVST; RTS: CHMF;
"the Company"), one of the world's leading metals and mining companies,
today announced that it has reached a binding agreement to purchase WCI
Steel (OTC: WCIS), a market leader in the production of value-added steel
products 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$327 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 irrevocably consented to the transaction. The acquisition
has the full support of the United Steel Workers ("USW").

    WCI's total annual steel-making capacity of 1.22 million metric tons is
focused on high-quality, custom flat-rolled steel for use in demanding
applications. Together with Severstal's current US 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 complementary nature of WCI's manufacturing facility and product
offering to Severstal's existing US assets creates potential synergies that
together with strong steel industry fundamentals leave WCI poised to add
value across Severstal's US platform.

    Gregory Mason, CEO of Severstal International and COO of OAO Severstal,
commented, "This acquisition is aligned with Severstal's disciplined
approach to growing our US business while creating shareholder value. It
solidifies our position as the fourth largest steel producer in the US by
raising Severstal's total US capacity to just under 11 million metric tons
per year. The addition of WCI to Severstal's family will enhance our custom
product capabilities and create opportunities to increase profitability in
both the short- and long-term."

    The acquisition is subject to customary closing conditions, including
the receipt of all necessary government and regulatory approvals, and is
expected to close in late 2Q / early 3Q08.

    Citi and Raymond James are acting as financial advisors to Severstal on
this transaction. Skadden, Arps, Slate, Meagher & Flom LLP is acting as
legal counsel to Severstal.

    About Severstal:

    OAO Severstal is an international metals and mining company with a
listing on the Russian Trading System and the London Stock Exchange.
Incorporated in 1993, the company focuses on high value added and unique
niche products and has a successful track record of acquiring and
integrating high-quality assets in North America and Europe. Severstal owns
mining assets in Russia, thus securing its supplies of raw materials. In
2007, Severstal produced 17.5 million tons of steel. Revenues were $15.2
billion and EBITDA was $3.7 billion. EPS was $1.92.

    Forward Looking Statements:

    This press release may contain projections and other forward-looking
statements regarding future events or the future financial performance of
OAO Severstal (Severstal). Forward looking statements are identified by
terms such as "expect," "believe," "anticipate," "estimate," "intend,"
"will," "could," "may" or "might", the negative of such terms, or other
similar expressions. Severstal wishes to caution you that these statements
are only predictions and that actual events or results may differ
materially. Severstal does not intend to update these statements to reflect
events and circumstances occurring after the date hereof or to reflect the
occurrence of unanticipated events. Factors that could cause the actual
results to differ materially from those contained in projections or
forward-looking statements of Severstal may include, among others, general
economic conditions in the markets in which Severstal operates, the
competitive environment in, and risks associated with operating in, such
markets, market change in the steel and mining industries, as well as many
other risks affecting Severstal and its operations.



    For further information:

    Severstal
    Dmitry Druzhinin, Investor Relations
    +7 495 540 7766

    Taylor Rafferty

    Michael Henson
    +1 212 889 4350 (o)
    +1 917 902 0767 (m)

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