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Ilyich Iron and Steel Works

As of the first six months of 2010 Metinvest’s sales network in Russia has doubled

24 June 2010 // Press centre Metinvest Group

Metinvest-Eurasia, a wholesale and retail channel of Metinvest Group in Russian Federation, has commissioned a new service metal center in the city of Mineralnye Vody. It is planned to sustain minimum stock level at 5 thous. t. Opening of new service metal centers during the last six months contributed to doubling of the distribution network and sales volumes – up to 16 metal bases and 46 thous. t per month, respectively. Total sales volume for the five months of 2010 comprised 202 thous. t.

Product range at Mineralnye Vody warehouse includes rebars, beams, channels, angles, plate and wire rod from Azovstal Iron and Steel Works (Mariupol), JSC Yenakiievo Metallurgical Works, as well as from other iron and steel works of Ukraine and CIS. During the first three months, the warehouse will maintain minimum inventory level of around 2-3 thous. t with following increase up to 5 thous. t. The warehouse in Mineralnye Vody will sell to all regions of newly established North Caucasian Federal District.

Favorable location of the warehouse in Mineralnye Vody close to Pyatigorsk, the center of North Caucasian Federal District, at the cross-roads of the highways of the region, creates additional advantages for local clients providing convenient logistics for construction sites and industrial enterprises. Priority objective of the distributors is to assure continuous availability of a broad range of rolled products and throughput of orders. Sales departments practice individual approach to clients and provide flexibility of order configurations, including customized product mix.

Metinvest sales network in Russia covers Central, Southern, North Western and North Caucasian Federal Districts, as well as the largest cities – Moscow and St. Petersburg. During the last 6 months, the sales network has doubled to 16 metal bases as new metal bases were established in Moscow, Belgorod, Taganrog, Voronezh, Volgograd, Novorossiysk and Mineralnye Vody. Monthly sales volume increased up to 46 thous. t per month in the period from August 2009 to May 2010, which is almost a twofold increase vs. monthly average performance in the previous year. Thus, sales volume for the first five months of 2010 comprised 202 thous. t, vs. 120 thous. t. for the similar period of 2009. In 2009 Metinvest’s total sales volume through its Russian sales network comprised 349 thous. t of rolled products. Of total sales volumes, around 75% are long products and 25% is plate.

«Expansion of the client base in Russia is one of the strategically important areas of our marketing policy. We believe in long-term potential of Russian market development, and we strive to meet high-level requirements of Russian customers» — noted Roman Rybalov, CEO of Metinvest-Eurasia, LLC.

Briefing Note:

Metinvest-Eurasia, LLC is the wholesale and retail channel of Steel and Rolled Products Division of Metinvest Group in Russian Federation. The Company sells goods manufactured by Azovstal I&SW, Yenakiievo Metallurgical Works, and other enterprises at the market of Russia through the network of branches located in Central, Southern and North-Western Districts of Russian Federation.

Metinvest is an international vertically integrated mining and steel group of companies. Production facilities of Metinvest produce enough steelmaking raw materials to meet its own demand and to be the key supplier to major steelmaking companies in Ukraine, Europe and Asia. The major shareholders of Metinvest are SCM Group (75% ownership) and Smart-Holding (25% ownership) partnering in Company’s management.

METINVEST HOLDING, LLC is the managing company of Metinvest Group.