MMK signs SPA to consolidate 100% of MMK-Atakas

Open Joint Stock Company

Magnitogorsk Iron and Steel Works

Press Release

March 11, 2011 Magnitogorsk, Russia

OJSC Magnitogorsk Iron and Steel Works (MMK) announces signing of share purchase agreement with view to consolidate 100% shares of MMK ATAKAŞ METALÜRJİ SANAYİ TİCARET VE LİMAN İŞLETMECİLİĞİ ANONİM ŞİRKETİ

MMK announces signing of the share purchase agreement to acquire 50 percent minus one share of MMK-Atakas from the Atakas Family. The agreement price is USD 485 million. Thus, MMK will be able to consolidate 100% shares in the Company. The transaction is expected to be completed by November 01, 2011. The completion is subject to obtaining necessary permissions and approvals.

"Consolidation of the 100% control in MMK-Atakas by MMK is part of the MMK strategy aimed at establishing the MMK Group presence on the key and rapidly growing markets in Russia and Middle East, primarily in Turkey. Consolidation will ensure more efficient management of the Company and help capitalize on the promising Turkish market of flat rolled products," - said Victor Rashnikov, MMK Chairman of the Board.

The construction of the plant began in March 2008. The project's two sites, located in Iskenderun and Istanbul, will have the full capacity of 2.3 mtpy of rolled flats. The total investments are estimated at approximately $2.1 bn.

At the moment, the complex operates an electric arc furnace facility, a cold-rolling facility, a hot-dip galvanizing unit and a color coating line located in Iskenderun plus two service centers in Iskenderun and Istanbul. It also includes a sea port capable of catering ships of up to 100,000 dwt which significantly expands the plants export capacity and facilitates supplies of raw materials for steel production.

About OJSC MMK

OJSC MMK is among the world's largest steel producers and is one of the leaders of Russia's steel industry. The company's operations in Russia include a large steel producing complex encompassing the entire production chain, from preparation of iron ore to downstream processing of rolled steel. MMK turns out a broad range of steel products with a predominant share of higher value added products. In 2010, the MMK Group produced 11.4 mln tons of crude steel and 10.4 mln tons of commercial steel products.

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