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Usinor Announces Construction of Cold Rolling and Hot Dip Galvanizing Units In Brazil to Serve Auto Industry in South America

16 June 2000

Usinor Announces Construction of Cold Rolling and Hot Dip Galvanizing Units In Brazil to Serve Auto Industry in South America

    PARIS - As part of its worldwide strategy as a provider of comprehensive 
solutions to the automobile industry, Usinor will build of a new unit based in 
Sao Francisco do Sul (Santa Catarina State) in Brazil.  Dofasco, Canadian leader 
in flat carbon steels, had announced it is entering into a Letter of Intent to 
acquire a 20% stake in this project.  The Spanish group Corporacion Gestamp, 
specialized in steel service centers and stamping, and also present in Brazil 
and Argentina, will have a 10% stake in the project.  Usinor already operates a 
joint-venture with the automobile oriented Dofasco in Ontario (Canada) to 
provide fast-growing markets in North America with galvanized products for the 
automobile industry.

    Dubbed name Vega do Sul, the project includes the building of a cold
rolling mill with an initial capacity of 800 kt, with potential expansion to
1.2 Mt, and the construction of an integrated hot-dip galvanizing line based
on Usinor's Extragal technology.  The latter line will have an annual capacity
of 400 kt and will be dedicated to serving fast-growing demand for coated
steels for auto bodies.  The project represents a total investment of
USD400 million.  Production is scheduled to begin in early 2003.

    In a related move, Usinor's partnership with CST (Companhia Siderurgica de
Tubarao, Brazil) and its shareholders, initiated when Usinor acquired an
equity interest in Acesita and CST, is today being strengthened through a
commercial agreement for the provision of hot rolled coils from CST's hot
rolling mill, now under construction.  CST also has an option to acquire an
equity interest in the new project.

    The location of the new unit was selected primarily to enhance logistics
and ensure the high quality of service made possible by delivery by sea of hot
rolled coils from CST in Vitoria (State of Espirito Santo).  Furthermore, the
facility is ideally located to ship products to key auto industry customers in
the Mercosur zone.

    Usinor is Europe's leading provider of steel for automobiles.  This new
project enables the group to serve automaker customers with global operations
by establishing production facilities in South America using its own
technology.  This same strategy is behind the DoSolGalva joint-venture with
Dofasco, established in 1999, which provides North American carmakers with
steel solutions available locally.

    Dofasco is a leading North American steel producer.  Product lines include 
hot rolled, cold rolled, galvanized and tinplate flat rolled steels, as well as 
tubular products.  Dofasco's wide range of steel products is sold to customers 
in the automotive, construction, steel distribution, packaging, pipe and tube, 
manufacturing and appliance industries.

    This press release contains certain forward-looking statements regarding
anticipated market evolution and the future prospects of Usinor.  While these
statements are based on Company's best estimates as of the date hereof, actual
results will vary as a function of market conditions, the action of
competitors, consumer demand, steel prices, economic conditions and other
factors.