Yalian Steel Closes $8.5 Million Private Placement

    VANCOUVER, June 19 /CNW/ - Yalian Steel Corporation (TSX-V: YL) ("Yalian"
or the "Company") is pleased to announce that it has completed its previously
announced "bought deal" private placement financing. The Company issued
5,000,000 common shares (the "Common Shares") at a price of C$1.70 per Common
Share (the "Offering") to raise aggregate gross proceeds of C$8,500,000.
    GMP Securities L.P. acted as the underwriter in connection with the
Offering, and in consideration of its services, received a cash commission of
$510,000 and warrants to purchase 300,000 Common Shares at an exercise price
of C$1.70 (the "Underwriter's Warrants"). The Underwriter's Warrants are
exercisable until December 19, 2010.
    The Common Shares were offered on a private placement basis to Canadian
residents who are accredited investors under applicable securities laws, and
in the United States on a private placement basis pursuant to an exemption
from the registration requirements of the United States Securities Act of
1933, as amended.
    Both the Common Shares and the Underwriter's Warrants issued pursuant to
the Offering are subject to a hold period in accordance with applicable
Canadian securities laws which expires on October 20, 2009.
    The Company also announces a grant of options exercisable for 100,000
Common Shares at $1.95 per Common Share to its Chairman and Acting Chief
Executive Officer, Edward (Bud) M. Siegel Jr. The options will vest over a
three year period with 6.5% of the options vesting three months after the date
hereof, and an additional 8.5% of options vesting every three months

    About Yalian Steel Corporation

    Yalian Steel Corporation is a British Columbia corporation focused on the
production of high quality Longitudinally Submerged Arc Welded (LSAW) steel
pipe to service Asia's rapidly growing energy transportation infraastructure
market. The Company is currently completing construction of its initial
manufacturing facility in City of Yangzhou, in the Jiangsu province of China.
Completion of the first production line, with a capacity of up to 200,000
metric tons per year, is scheduled for the fall of 2009. The Yangzhou Yalian
plant will utilize the JCOE (J-ing, C-ing, O-ing, Expanding) process, an
advanced method of LSAW pipe production that involves the bending and shaping
of X-80 grade steel.

    Neither the TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this press release.

For further information:

For further information: YALIAN STEEL CORPORATION: Hong (Iris) Duan,
Chief Financial Officer, Tel. No. (604) 696-6388

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