EANS-Adhoc: Salzgitter AG launches an offering of bonds exchangeable into shares of Aurubis AG

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ad-hoc disclosure pursuant to section 15 of the WpHG transmitted by euro
adhoc with the aim of a Europe-wide distribution. The issuer is solely
responsible for the content of this announcement.
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28.10.2010

Salzgitter, October 28, 2010

Not for publication or distribution in the United States, Australia, Canada,
Japan or South Africa

Ad-hoc-release according to § 15 WpHG

Salzgitter AG launches an offering of bonds exchangeable into shares of Aurubis
AG

The Management Board of Salzgitter AG, with the approval of the Supervisory
Board, resolved today to issue senior unsecured bonds exchangeable into existing
ordinary bearer shares of Aurubis AG (the "Bonds"). The Bonds will be issued by
Salzgitter Finance B.V. (the "Issuer"), a wholly-owned Dutch subsidiary of
Salzgitter AG, and are guaranteed by Salzgitter AG. The Bonds (each with a
denomination of EUR50,000) will be offered in an accelerated bookbuilding to
institutional investors outside of the U.S. only.

The base offering size will be approximately EUR 250 million (over approximately
6 million shares of Aurubis AG initially). The base offering size may be
increased by up to EUR 25 million by Salzgitter AG. In addition, Salzgitter AG
has granted the Joint Bookrunners a greenshoe option of up to EUR 25 million to
cover over-allotments (if any). The maximum number of underlying shares of
Aurubis AG assuming exercise of increase and greenshoe options will initially be
up to 7 million, representing approximately 17% of the current share capital of
Aurubis AG. The issue size can amount to up to approximately EUR 300 million,
depending on the development of the Aurubis AG share price during placement.

With this transaction Salzgitter AG diversifies its funding sources and intends
to use the proceeds from the sale of the exchangeable bonds for general
corporate purposes.

The Bonds will have a maturity of seven years and are callable by the Issuer on
or after 28 November 2013 if the Aurubis AG share price (over a certain period)
exceeds 130% of the then applicable exchange price. Holders of the Bonds will be
entitled to require an early redemption of their Bonds on the fifth anniversary
of the issue date, at the principal amount plus accrued interest. The Bonds will
be issued around 8 November 2010 (the "Settlement Date") at 100% of the
principal amount. The coupon will be between 1.75%- 2.50 % p.a. and will be
determined during an accelerated bookbuilding taking place today. The exchange
price will be set at an exchange premium of 25% above the VWAP (Volume Weighted
Average Price) of the Aurubis AG share on XETRA from the time of launch of the
placement until pricing, which is expected to occur today.
Salzgitter AG intends to list the Bonds on the Open Market (Freiverkehr) segment
of the Frankfurt Stock Exchange. BofA Merrill Lynch, Commerzbank and Deutsche
Bank are acting as Joint Bookrunners and Lead Managers in relation to the
transaction.

The commitment of Salzgitter AG to its stake of Aurubis AG is underpinned by
certain structural features of the Bonds, such as the Issuer´s ability to cash
settle the Bonds if Bondholders decide to exercise their exchange right. This
reflects Salzgitter AG´s strong interest in further supporting Aurubis AG in its
successful development which is also of advantage for Salzgitter AG.
From the date of the announcement of the final terms of the Bonds, BofA Merrill
Lynch, as stabilisation manager, may over-allot or effect transactions with a
view to supporting the market price of the Bonds at a level higher than that
which might otherwise prevail. Such stabilising, if commenced, must be brought
to an end no later than 5 November 2010. If commenced, such stabilising may lead
to a market price of the Bonds which may be higher than the level that would
exist if no such stabilising measures were taken and may indicate to the market
a price stability which without such stabilising might not prevail. However,
there is no obligation to engage in such stabilisation activities and such
stabilisation, if commenced (which may not occur before the final terms of the
Bonds have been announced), may be discontinued at any time.
Stabilisation/FSA.

IMPORTANT NOTE - NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA (OR TO US PERSONS),
AUSTRALIA, CANADA, JAPAN OR SOUTH AFRICA, OR IN ANY OTHER JURISDICTION IN WHICH
OFFERS OR SALES WOULD BE PROHIBITED BY APPLICABLE LAW

This ad- hoc announcement is for information purposes only and does not
constitute or form part of, and should not be construed as an offer or an
invitation to sell, or issue or the solicitation of any offer to buy or
subscribe for, any securities. In connection with this transaction there has not
been, nor will there be, any public offering of any securities. No prospectus
will be prepared in connection with the offering of the Bonds. The Bonds may not
be offered to the public in any jurisdiction in circumstances which would
require the Issuer of the Bonds to prepare or register any prospectus or
offering document relating to the Bonds in such jurisdiction.
The distribution of this ad- hoc announcement and the offer and sale of the
Bonds in certain jurisdictions may be restricted by law. Any persons reading
this ad- hoc announcement should inform themselves of and observe any such
restrictions.

This ad- hoc announcement does not constitute an offer to sell or a solicitation
of an offer to purchase any securities in the United States. The securities
referred to herein (including the Bonds and the shares of Aurubis AG) have not
been and will not be registered under the U.S. Securities Act of 1933, as
amended (the "Securities Act") or the laws of any state within the U.S., and may
not be offered or sold in the United States or to or for the account or benefit
of U.S. persons, except in a transaction not subject to, or pursuant to an
applicable exemption from, the registration requirements of the Securities Act
or any state securities laws. This ad- hoc announcement and the information
contained herein may not be distributed or sent into the United States, or in
any other jurisdiction in which offers or sales of the securities described
herein would be prohibited by applicable laws and should not be distributed to
United States persons or publications with a general circulation in the United
States. No offering of the Bonds is being made in the United States.

Subject to certain exceptions, the securities referred to herein (including the
Bonds and the shares of Aurubis AG) may not be offered or sold in Australia,
Canada, Japan or South Africa to, or for the account or benefit of, any
national, resident or citizen of Australia, Canada, Japan or South Africa. The
offer and sale of the securities referred to herein has not been and will not be
registered under the applicable securities laws of Australia, Canada or Japan.

In the United Kingdom, this ad- hoc announcement is only being distributed to
and is only directed at (i) persons who have professional experience in matters
relating to investments falling within Article 19(1) of the Financial Services
and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") and (ii)
high net worth entities falling within Article 49(2) of the Order and (iii)
persons to whom it would otherwise be lawful to distribute it (all such persons
together being referred to as "relevant persons"). The Bonds are only available
to, and any invitation, offer or agreement to subscribe, purchase or otherwise
acquire such Bonds will be engaged in only with, relevant persons. Any person
who is not a relevant person should not act or rely on this ad- hoc announcement
or any of its contents.

The Joint Bookrunners are acting on behalf of the Issuer and Salzgitter and no
one else in connection with the securities and will not be responsible to any
other person for providing the protections afforded to clients of the Joint
Bookrunners, or for providing advice in relation to the securities.

In connection with the offering of the Bonds, each of the Joint Bookrunners and
any of their respective affiliates acting as an investor for their own account
may take up Bonds and in that capacity may retain, purchase or sell for its own
account such securities and any securities of the Issuer, of Salzgitter AG or of
Aurubis AG or any related investments and may offer or sell such securities or
other investments otherwise than in connection with the offering of the Bonds.
The Joint Bookrunners do not intend to disclose the extent of any such
investment or transactions otherwise than in accordance with any legal or
regulatory obligation to do so.

Any offer if made may only be addressed to and directed, in member states of the
European Economic Area which have implemented the Prospectus Directive (each, a
"relevant member state"), at persons who are "qualified investors" within the
meaning of Article 2(1)(e) of the Prospectus Directive (Directive 2003/71/EC)
and pursuant to the relevant implementing rules and regulations adopted by each
relevant member state ("Qualified Investors").

Each person who initially acquires any Bonds in connection with the issuance or
to whom any offer of securities may be made will be deemed to have represented,
acknowledged and agreed that it is a Qualified Investor as defined above.
In the case of any securities being offered to any investor as a financial
intermediary as that term is used in Article 3(2) of the Prospectus Directive,
such investor will also be deemed to have represented and agreed that the
securities acquired by it in the offering have not been acquired on behalf of
persons in the EEA other than Qualified Investors or persons in the UK and other
member states (where equivalent legislation exists) for whom the investor has
authority to make decisions on a wholly discretionary basis, nor have the
securities been acquired with a view to their offer or resale in the EEA where
this would result in a requirement for publication by the Issuer, Salzgitter AG
or the Joint Bookrunners of a prospectus pursuant to Article 3 of the Prospectus
Directive, unless the prior consent of the aforementioned parties has been
obtained to such offer or resale.

Further inquiry note:
Markus Heidler
+49 (0) 5341/21-6105
[email protected]
end of announcement euro adhoc
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issuer:      Salzgitter AG
             Eisenhüttenstraße 99
             D-38239 Salzgitter
phone:       +49 (0) 5341-21-3783
mail:        [email protected]
WWW:         http://www.salzgitter-ag.de
sector:      Iron & Steel
ISIN:        DE0006202005
indexes:     Midcap Market Index, MDAX, CDAX, Classic All Share, Prime All Share

stockmarkets: regulated dealing/prime standard: Frankfurt, free trade: Berlin,
Hamburg, Stuttgart, Düsseldorf, Hannover, München
language: English

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