Severstal completes acquisition of Esmark Incorporated

The offering period for Severstal’s tender offer for all outstanding shares of Esmark expired at 10:00 a.m., Eastern Daylight Time, on Monday, August 4, 2008, with a total of 38,767,487 Esmark shares being validly tendered in the offer and not withdrawn, representing approximately 94.17% of the outstanding shares of common stock of Esmark.  All shares that were validly tendered during the tender offer have been accepted for purchase, and Severstal paid for all validly tendered and delivered shares on August 4, 2008.    

Following the expiration of the offering period, on August 4, 2008, Severstal effected a merger to complete the acquisition of Esmark without a vote or meeting of Esmark stockholders pursuant to the short-form merger procedure available under Delaware law.  In the merger, each outstanding Esmark share not tendered and purchased in the offer (other than shares in respect of which appraisal rights are validly exercised under Delaware law) were converted into the right to receive the same $19.25 per share price, without interest and less any required withholding taxes, that was paid in the tender offer.  As a result of the merger, Esmark’s common stock will cease to be traded on the NASDAQ Global Select Market.

The acquisition has a total equity value of approximately $775 mln and is expected to be accretive in 2009 based on current projections of costs and prices.

With the completion of the tender offer and consummation of the merger, Severstal acquired all of Esmark’s businesses, including:

Gregory Mason, CEO of Severstal International and COO of OAO Severstal, commented, “The acquisition of Esmark represents a significant step in Severstal’s North American growth strategy. Not only does the addition of Esmark bring considerable stand-alone growth potential while also creating synergies with our existing US plants, it solidifies Severstal’s position as one of the leading integrated steel companies in the fast consolidating North American market. We are now poised to be a leading producer and supplier of domestically produced steel to a region that has a consistent demand for high quality products.”

Merrill Lynch acted as lead financial advisor, Citi acted as financial advisor, and Skadden, Arps, Slate, Meagher & Flom LLP acted as legal counsel, to Severstal.  MacKenzie Partners, Inc. served as Information Agent for the tender offer.