WCI Steel committed to deal with Severstal despite legal challenge by Optima International

By Lisa Kerner

Charlotte, N.C., June 18 - WCI Steel, Inc. said the legal challenge filed by Optima International of Miami and some minority stockholders representing less than 18% of the shares outstanding is without merit.

On May 16, holders of a majority of WCI Steel's shares approved a sale of the company to OAO Severstal, according to a WCI statement

"We intend to vigorously defend against this baseless action and will continue to pursue an expeditious closing of the sale, which will significantly improve the long-term prospects for the Warren facility," the statement said.

WCI Steel made its remarks in response to media inquiries, according to the statement.

Severstal agreed to acquire WCI Steel for $140 million in total cash, or about $3.29 per share.

The enterprise value of the transaction, based on outstanding net debt as of April 30, is $327 million, according to an earlier Severstal news release.

It was previously reported that holders of a majority of WCI Steel's diluted shares outstanding agreed to vote for the transaction, which also has the full support of the United Steel Workers.

The acquisition is expected to close late in the second quarter or early in the third quarter of 2008.

WCI Steel, a Warren, Ohio-based producer of value-added, custom steel products, is not currently a public reporting company.

Severstal is a Moscow-based metals and mining company.

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