Stelco engaged in strategic review



    HAMILTON, ON, June 1 /CNW/ - Stelco Inc. (TSX: STE) today confirmed that
it is reviewing strategic options for the company in light of the ongoing
consolidation in the steel industry. The company has appointed a special
committee of directors and CIBC World Markets and UBS to assist it in this
review. The company intends to evaluate a broad range of possible alternatives
including mergers, strategic partnerships, acquisitions or a sale of all or
part of the company.
    Discussions regarding these alternatives with third parties are at a very
preliminary stage and there have been no discussions on the material terms of
any transaction. Accordingly, there is no assurance that a transaction will
result from these discussions or as to the timing, structure or terms of any
transaction, and no further comment will be forthcoming unless the situation
warrants.
    "Since emerging from CCAA, Stelco has been committed to building a
stronger, more cost-efficient steel company, which would eventually become
part of the global consolidation in the industry. As part of the restructuring
efforts, Stelco has focused on completing the upgrade of the Lake Erie Hot
Mill and addressing productivity and cost issues at the Hamilton works. We
believe it is appropriate to begin the next phase of our business plan and
explore all potential alternatives for positioning Stelco to be an integral
part of a larger, globally competitive company," stated Rodney Mott, President
and Chief Executive Officer.

    About Stelco

    Stelco is one of Canada's largest steel companies. It is focused on its
two Ontario-based integrated steel businesses located in Hamilton and in
Nanticoke. These operations produce high quality value-added hot rolled, cold
rolled, coated sheet and bar products. To learn more about Stelco and its
businesses, please refer to our Web site at www.stelco.com.

    CAUTION REGARDING FORWARD-LOOKING INFORMATION

    This press release contains "forward-looking information" that is based
on Stelco's expectations as of the date of this press release or as of the
date which such information is identified to be given. This forward-looking
information includes, among other things, factors relating to the business,
operations and prospects of Stelco, including the possibility of the
completion of a possible transaction. Often, but not always, forward-looking
information can be identified by the use of words and phrases such as "plans",
"expects" or "does not expect", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates" or "does not anticipate",
or "believes", or variations of such words and phrases or states that certain
actions, events or results "may", "could", "would", "might" or "will" be
taken, occur or be achieved. Forward-looking information involves known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of Stelco to be materially different from
any future results, performance or achievements expressed or implied by the
forward-looking information. Actual results, performance and achievements are
likely to differ, and may differ materially, from those expressed or implied
by the forward-looking information contained herein. Such forward-looking
information is based on a number of assumptions which may prove to be
incorrect, including, but not limited to: the outcome of the discussions
referred to in the press release and whether any transaction will result from
such discussions or otherwise. While Stelco anticipates that subsequent events
and developments may cause Stelco's views to change, Stelco specifically
disclaims any obligation to update this forward-looking information. This
forward-looking information should not be relied upon as representing Stelco's
views as of any date subsequent to the date of this press release.

    %SEDAR: 00001549E




For further information:

For further information: Rodney B. Mott, President and Chief Executive
Officer, Stelco Inc., (905) 528-2511, Extension 2020

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STELCO INC.

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