Mechel announces offering of preferred shares by certain selling shareholders

Mechel, one of the leading Russian mining and metals companies, announces the launch of a public offering (the “Offering”) by certain selling shareholders of the preferred shares of Mechel OAO.

The preferred shares are being offered by James C. Justice II, James C. Justice III, James C. Justice Companies Inc. and Jillean L. Justice (the “Selling Shareholders”). The Selling Shareholders propose to offer up to 26,000,000 preferred shares to Russian and international investors. The Offering has been registered with the U.S. Securities and Exchange Commission (the “SEC”) under an automatic shelf registration statement filed by Mechel.

Mechel has applied for admission of the preferred shares to trading (without listing) on the Open Joint Stock Company “Russian Trading System” Stock Exchange (the “RTS”) and on the Closed Joint Stock Company “MICEX Stock Exchange” (the “MICEX”). We expect the preferred shares to be admitted to trading prior to settlement of the preferred shares sold in the Offering, under the symbol “MTLRP”.

Morgan Stanley & Co. Incorporated and Renaissance Securities (Cyprus) Limited will be acting as Joint Global Coordinators and Joint Bookrunners for the Offering. VTB Capital will be acting as a Joint Bookrunner for the Offering. VTB Capital is not registered as a broker-dealer with the SEC, therefore any offers and sales of the preferred shares by VTB Capital in the United States will be made through one or more SEC-registered broker-dealers, which may be affiliates of VTB Capital, to the extent required by applicable U.S. securities laws and regulations. Coalmetbank will be marketing the preferred shares to the general public in the Russian Federation. Coalmetbank will not underwrite any of the preferred shares sold in the offering.

A copy of the prospectus relating to the Offering can be obtained on the EDGAR website operated by the SEC or by contacting the underwriters for the Offering through Morgan Stanley & Co. Incorporated, 1585 Broadway, New York, NY 10036, United States of America, tel: +1 (866) 718-1649 (attention of Prospectus Department, 180 Varick Street, New York, NY 10014, e-mail: prospectus@morganstanley.com); or, for requests from the United States, through RenCap Securities, Inc., 780 3rd Avenue, 20th Floor, New York, NY 10017, USA, tel: +1 (212) 824-1099 (attention of David Kuzmanich and John Duffy) and, for requests outside the United States, through Renaissance Capital Limited, One Angel Court, Copthall Avenue, London, EC2R 7HJ, United Kingdom, tel: +44 (20) 7367-7777 (attention of Brien McMahon and Robert Hagon); or, for requests outside the United States, through VTB Capital Plc, 14 Cornhill, London EC3V 3ND, United Kingdom, tel: + 44 (20) 3334-8000 (attention of Equity Syndicate).