PRESS RELEASE

The Merger Agreement between Arcelor and Severstal has been Terminated

Moscow, June 30, 2006 - The merger agreement between Arcelor and Severstal has today been terminated.

Mr. Mordashov is encouraged and gratified by all the positive feedback he has received about Severstal during the process from many Arcelor shareholders and stakeholders. The experience has greatly raised Severstal's profile and standing within the investment community.

Mr. Mordashov continues to assess all of his strategic options.

Severstal will continue to be a vibrant player in the global steel market, and will continue to explore opportunities to expand its position as a leading producer of high quality steel.