IMSA ACERO to Invest US$120 million to Increase Production Capacity

MONTERREY, Mexico--Dec. 1, 20055, 2005--Grupo Imsa (BMV:IMSA) announces that its Board of Directors has authorized a US$120 million investment for IMSA ACERO to increase its production capacity of cold-rolled, pre-painted and galvanized steel sheet. The additional capacity will be installed at the company's current facilities in Monterrey, Mexico.

The project includes a new continuous industrial line to galvanize and paint high-specification steel, thereby positioning the company to offer enhanced service to industrial markets such as the automotive, appliance and refrigeration sectors. The new production line will have the capacity to galvanize 300,000 tonnes of steel per year and will have the flexibility to paint 130,000 tonnes of the total capacity. The company will start implementing this project at the beginning of 2006 in order to have the new line operational by mid-2007. At the same time, IMSA ACERO will increase its cold-rolling capacity by 260,000 tonnes of steel which will be used to feed the new galvanizing and painting line.

Mr. Santiago Clariond, President and CEO of IMSA ACERO, explained, "This line, which will be the most advanced steel galvanizing and painting line in Mexico, reinforces IMSA ACERO's commitment to serve the highest specification markets. Over the past few years, the domestic market for coated steel has grown considerably, driven by growth in industrial markets, where we have seen plants from other countries being relocated to Mexico in order to better serve the North American market. Additionally, we have been very successful in certifying our operations to supply these target markets, so it is very important that we plan the expansion of our installed capacity in order to continue capitalizing on market growth without affecting our level of service."

Grupo Imsa dates back to 1936 and is today one of Mexico's leading diversified industrial companies. With manufacturing and distribution facilities in Mexico, the United States, Europe, and throughout Central and South America, Grupo Imsa has an important presence throughout the world. In 2004 the Company's sales reached US$3.3 billion, of which close to 50% was generated outside Mexico. Grupo Imsa shares are traded on the Mexican Stock Market (IMSA).