July 7, 2008

Severstal Completes Acquisition of WCI Steel

MOSCOW, July 7 /PRNewswire-FirstCall/ -- OAO Severstal (LSE: SVST; RTS: CHMF; "the Company"), one of the world's leading metals and mining companies, today completed its previously announced acquisition of WCI Steel, a market leader in the production of value-added steel products based in Warren, Ohio. WCI Steel will be known as Severstal Warren, Inc.

Severstal acquired all of the outstanding equity of WCI for a total cash consideration of US$140 million.

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, WCI will solidify the Company's position as one of North America's leading producers of high-quality flat-rolled steel for the automotive, appliance, furniture, construction and energy markets.

Citi and Raymond James acted as financial advisors and Skadden, Arps, Slate, Meagher & Flom LLP acted as legal counsel to Severstal.

Gregory Mason, CEO of Severstal International and COO of OAO Severstal, commented, "Steel production in Warren has long contributed high-quality products to a region that is at the historical center of steelmaking in the US. Severstal is ready to carry that tradition forward in a way that is consistent with our strategy for growth and investment in North America; a strategy that views the experience and talent of the people at WCI Steel as a key part of Severstal's continued success."

In connection with the acquisition, WCI announced that it has called for redemption all of the US$100 million aggregate principal amount outstanding of its 8% Senior Secured Notes due 2016 (CUSIP No. 92927H AA 7) (the "Notes"). On July 7, 2008, a copy of the irrevocable notice of redemption was mailed to record holders of the Notes by Wilmington Trust Company, Rodney Square North, 1100 Market Street, Wilmington, DE 19890, the trustee under the indenture governing the Notes. The Notes will be redeemed on August 6, 2008.

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.

About Severstal International:

Severstal International is an operating division of OAO Severstal comprising North American and European segments.

About WCI Steel, Inc.

WCI Steel's strength is built on "Custom Steel. Custom Service. Creative Solutions." As an integrated producer of value-added, custom steel products serving niche markets, WCI Steel emphasizes customer and technical service. WCI Steel currently produces 185 grades of flat-rolled custom and commodity steel products at its Warren, Ohio facility. WCI Steel focuses on a wide range of custom flat-rolled steel products, including high carbon, alloy, ultra high strength, and heavy-gauge galvanized steel and on developing closer, more responsive relationships with customers. Major customers are steel converters, processors, service centers, construction product companies, and pipe and tube manufacturers.

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   Olga Antonova, Public Relations   +7 495 540 7766    Taylor Rafferty for Severstal    Michael Henson   +1 212 889 4350 (o)   +1 917 902 0767 (m)    John Dudzinsky   +1 212 889 4350 (o)   +1 646 715 2980 (m)  

OAO Severstal

CONTACT: Severstal, Dmitry Druzhinin, Investor Relations, Olga Antonova,Public Relations, +7 495 540 7766; Taylor Rafferty for Severstal, MichaelHenson, +1-212-889-4350, or mobile - +1-917-902-0767, John Dudzinsky, +1-212-889-4350, or mobile - +1-646-715-2980