Severstal Announces Change to SeverCorr Executive Management Team

This is following the company’s previous announcements that it will consolidate SeverCorr as a Severstal company and that it intends to purchase the ownership interests in SeverCorr held by John Correnti and other members of the executive management team.

Severstal has appointed a new senior management team at SeverCorr and will leverage its track record of operational excellence and its experience in successfully acquiring and integrating high-quality assets in both North America and Europe to ensure long-term success at the mill.

James Hrusovsky has been appointed the new CEO of SeverCorr and will be based in Columbus, Mississippi. He was formerly COO of Severstal North America, Inc. ("SNA"), the company's other U.S. business, and has over 26 years of industry experience in both strategic and operational roles. Sergei Kuznetsov, CFO of SNA with twelve years of industry experience, has been appointed the new CFO of SeverCorr. He will have financial management and reporting responsibilities for both SeverCorr and SNA and will remain based in Dearborn, Michigan.

Commenting on the announcement, Severstal CEO Alexey Mordashov said, “John Correnti and his team have been tremendous partners and we wish them the very best in the future. In a relatively short period, they built from scratch one of the most technologically advanced mills in the steel industry that is strategically located to serve the fast growing Southern region of the U.S.

“Severstal remains committed to John’s vision and to SeverCorr’s employees, customers, partners and the Golden Triangle region and state of Mississippi. We are fully focused on delivering a seamless and cooperative transition. With the new management team in place, we are well positioned to lead SeverCorr into the next stage of its development and deliver value to all stakeholders.”

The transition of the executive management team and anticipated change of ownership structure is not expected to have any impact on SeverCorr’s operations. Other senior operational management of SeverCorr remains in place. SeverCorr will continue its successful production ramp-up and the Phase II expansion, which will more than double the mill’s output to 3 million metric tons, is on-track to be completed by late 2010.

John Correnti, said, “We’re proud of what we’ve accomplished at SeverCorr and I want to thank everyone who has helped make it possible. As SeverCorr moves from an entrepreneurial venture into an operating steel mill, it made sense for me and other founding senior managers to transition executive management responsibilities. Severstal was a valuable partner in getting this mill to where it is today.”