I Agree

We have updated our Privacy and Cookie Policy. By clicking "I Agree" below, you acknowledge that you accept our Privacy and Cookie Policy and Terms of Use.

PLEASE TELL US A LITTLE ABOUT YOURSELF SO THAT WE CAN DISPLAY THE MOST
APPROPRIATE CONTENT TO YOU:

This site uses cookies. Some of the cookies are essential for parts of the site to operate and have already been set. You may delete and block all cookies from this site, but if you do, parts of the site may not work. To find out more about cookies used on Trustnet and how you can manage them, see our Privacy and Cookie Policy.

By clicking "I Agree" below, you acknowledge that you accept our Privacy Policy and Terms of Use.

For more information Click here

Login

Register

It's look like you're leaving us

What would you like us to do with the funds you've selected

Show me all my options Forget them Save them
Customise this table
Share   Print      RSS

Europe Steel plc (EUSP)

Europe Steel plc

Offer by Ferrous Metal Company Limited

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN OR INTO THE
UNITED STATES, CANADA, AUSTRALIA, JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO
WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH OTHER JURISDICTION


FOR IMMEDIATE RELEASE                                                29 May 2008

                             Recommended Cash Offer

                                       by

                      Ferrous Metal Company Limited ("FMC")

                                       for

                        Europe Steel PLC ("Europe Steel")


Summary

  ·  The Boards of FMC and Europe Steel are pleased to announce that they have
     reached agreement on the terms of a recommended cash offer by FMC to acquire the
     entire issued and to be issued share capital of Europe Steel.

  ·  Europe Steel Shareholders will receive 50 pence in cash for each  Europe
     Steel Share, valuing Europe Steel's entire issued share capital at approximately
     £6.36 million.

  ·  The  Offer represents a premium of approximately 150 per cent. over  the
     Closing Price of 20 pence per Europe Steel Share on 28 May 2008 (being the last
     Business Day immediately prior to the announcement of the Offer) and a premium
     of approximately 121.15 per cent. over the average Closing Price of 22.61 pence
     per Europe Steel Share for the last 6 months.

  ·  FMC is a supplier of finished and semi-finished steel products to a diverse
     range  of  international customers and is headquartered and  registered  in
     Gibraltar.

  ·  Europe  Steel  is  a  trader  of  finished  steel  products  to  various
     international customers and its shares are traded on the PLUS-Quoted Market in
     the UK.

  ·  The Independent Directors of Europe Steel consider the terms of the Offer
     to be fair and reasonable and will unanimously be recommending that Europe Steel
     Shareholders accept the Offer.

  ·  FMC  has received, in aggregate, irrevocable undertakings to accept  the
     Offer in respect of 11,478,000 Europe Steel Shares representing 90.17 per cent.
     of the entire issued share capital of Europe Steel.

  ·  The Offer Document will be despatched to Europe Steel Shareholders as soon
     as practicable and in any event within 28 days of this announcement, unless
     otherwise agreed by the Panel.

This  Summary should be read in conjunction with the full text of the  following
announcement  and  Appendices.   Certain terms used  in  this  Summary  and  the
following announcement are defined in Appendix III of this announcement.




NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN OR INTO THE
UNITED STATES, CANADA, AUSTRALIA, JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO
WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH OTHER JURISDICTION


FOR IMMEDIATE RELEASE                                               29 May 2008


                             Recommended Cash Offer

                                       by

                      Ferrous Metal Company Limited ("FMC")

                                       for

                        Europe Steel PLC ("Europe Steel")


1.   Introduction

The  Boards  of FMC and Europe Steel are pleased to announce that agreement  has
been  reached  on the terms of a recommended cash offer to be  made  by  FMC  to
acquire the entire issued and to be issued share capital of Europe Steel for  50
pence  in  cash for each Europe Steel Share.  The Offer values Europe  Steel  at
approximately £6.36 million.

Lord  David  Owen,  Chairman of the Board of Europe Steel, is  a  consultant  to
Gallagher Holdings Limited which controls FMC.  As such he is considered  to  be
interested  in FMC and/or the Offer and he has decided to exclude  himself  from
any recommendation in respect of the Offer.  The Independent Directors, who have
been  so advised by Blomfield Corporate Finance, consider the terms of the Offer
to be fair and reasonable and will unanimously be recommending that Europe Steel
Shareholders  should  accept  the  Offer.   In  providing  its  advice  to   the
Independent  Directors, Blomfield Corporate Finance has taken into  account  the
commercial assessments of the Independent Directors.

2.   Terms of the Offer

The Offer will be subject to the terms and conditions set out or referred to  in
Appendix I to this announcement and the further terms and conditions to  be  set
out  in the Offer Document and, in the case of certificated Europe Steel Shares,
the Form of Acceptance.

The Offer is being made on the following basis:

            for each Europe Steel Share             50 pence in cash

The   Offer  values  the  entire  issued  share  capital  of  Europe  Steel   at
approximately £6.36 million and represents a premium of approximately:

  ·  150 per cent. over the Closing Price of 20 pence per Europe Steel Share as
     at 28 May 2008, being the last Business Day prior to the announcement of the
     Offer.

  ·  121.15 per cent. over the average Closing Price of 22.61 pence per Europe
     Steel Share over the 6 months prior to the announcement of the Offer.

The  Europe  Steel Shares will be acquired fully paid and free from  all  liens,
charges,  equitable  interests, encumbrances, rights of  pre-emption  and  other
third  party rights or interests of any nature whatsoever and together with  all
rights  now  or hereafter attaching to them, including the right to receive  and
retain all dividends and other distributions declared, made or paid on or  after
the date of this announcement.


3.   Information on Ferrous Metal Company

FMC  was  established  in May 2006 and its principal activity  is  the  sale  of
finished  and  semi-finished steel products and of raw materials  to  a  diverse
range  of international customers.  FMC has exclusive long term supply contracts
with two Russian steel mills and two Russian iron ore producing mines from which
it  sources  its trading product.  In 2007, FMC acquired Ferrous  Metal  Company
(IOM)  Limited  to consolidate its position as the sole international  off-taker
for the two Russian mills and two Russian mines.

The FMC Group is headquartered and registered in Gibraltar and is controlled  by
Gallagher Holdings Limited (a company incorporated in Cyprus) which owns 50  per
cent.  of  FMC's issued share capital.  Gallagher Holdings Limited is controlled
by  Mr  Alisher  Usmanov, a Russian businessman, who is considered  by  the  FMC
Directors as the ultimate controlling shareholder of the FMC Group.

The  financial  statements of FMC are prepared in accordance with  International
Financial Reporting Standards as adopted for use in the European Union.  For the
financial  year  ended  31 December 2007, the consolidated  FMC  Group  reported
revenues  of  approximately  US$3,010 million with  profit  before  taxation  of
approximately US$220.9 million.

4.   Information on Europe Steel

The  principal  activity  of  Europe Steel is  international  trading  in  steel
products, mainly hot rolled square billets.

Europe  Steel obtains its supplies of steel products exclusively from  FMC.   It
operates  from  offices  in  central London  where  its  sales,  purchasing  and
administration  functions are based, and Moscow where it  has  a  representative
office.  Europe Steel Shares are traded on the PLUS-Quoted Market in the UK.

The  financial statements of Europe Steel are prepared in accordance with United
Kingdom Generally Accepted Accounting Principles (UK GAAP) and for the financial
year  ended  31  December 2007 the Company reported revenue  of  £71.2  million,
compared to £51.7 million for the previous year.  Net profit after tax  for  the
31  December  2007  year was £0.69 million, or 5.41 pence per share  (basic  and
diluted),  compared to £0.68 million or 5.38 pence per share  for  the  previous
year.

Further  information, including financial information on Europe Steel,  will  be
contained in the Offer Document.

5.   Background to and reasons for the Offer

A key business objective of FMC is to advance its position as sole international
off-taker  for  the two Russian steel mills and two Russian iron  ore  producing
mines with which it has established long term supply contracts.

As  part of its strategy, the FMC Directors see the acquisition of Europe  Steel
as  a natural fit for the FMC Group as it would be able to exploit the potential
efficiencies  created through closer control of its distribution channels.   FMC
and  Europe  Steel already have a strong trading relationship by virtue  of  FMC
being  Europe  Steel's sole supplier.  The FMC Directors believe that  following
the  proposed  acquisition  the  business  of  Europe  Steel  would  quickly  be
integrated into the wider FMC Group.

6.   Reasons for recommending the Offer

Europe  Steel  is  supplied its steel product on a contract  by  contract  basis
through FMC which is the Company's sole supplier of steel product.

Although  Europe Steel and FMC have a strong trading relationship, any potential
withdrawal of future allocations of steel product by FMC to Europe Steel and re-
direction  to  alternative customers of FMC would leave the Company  financially
exposed.   As referred to under section 9 below, "Current trading and  prospects
of  Europe  Steel", although the level of sales achieved by Europe Steel  during
the  first  four months of the current trading year is approximately five  times
that  for  the same period of 2007, the Company's gross margins have  fallen  to
substantially lower levels under the non-exclusive supply contracts with FMC and
the  Europe Steel Directors believe that this pressure on margins is  likely  to
remain  the  prevailing business environment for the Company for the foreseeable
future.

In  deciding to recommend the Offer, the Independent Directors have  also  taken
into account a number of factors, including that the Offer Price equates to  the
price  at which the Europe Steel Shares were placed with investors when  it  was
originally  admitted to the OFEX market (now the PLUS-Quoted  Market)  in  March
2000. On 30 September 2002, the Company's shares were withdrawn from trading  on
OFEX  (at  its  request)  following a period of suspension  pending  a  proposed
transaction  which did not occur. Europe Steel Shares were then  re-admitted  to
trading in August 2003 and commenced trading at 12.5 pence, since when they have
risen to 20 pence, the Closing Price on 28 May 2008, the last Business Day prior
to  the announcement of the Offer. Since re-admission to trading in August 2003,
the  price of Europe Steel Shares has not recovered to the level when they  were
first  admitted to OFEX in March 2000.  The Offer Price now represents a premium
of approximately:

·  150 per cent. over the Closing Price per Europe Steel Share of 20 pence on 28
May 2008, the last Business Day prior to the announcement of the Offer; and

·  121.15 per cent. over the average Closing Price of approximately 22.61  pence
per Europe Steel Share over the 6 months prior to the announcement of the Offer.

The  Offer  Price also represents a multiple of 9.24 times Europe Steel's  basic
and  diluted earnings per Europe Steel Share for the 12 months ended 31 December
2007.

Europe  Steel Shareholders should be aware that, given the level of  irrevocable
undertakings  already  received by FMC in respect of the  Offer,  following  the
Offer  becoming  or  being declared unconditional in  all  respects  it  is  the
intention  of  FMC to exercise its right to acquire compulsorily  any  remaining
Europe  Steel Shares to which the Offer relates on the same terms as  the  Offer
and,  subject  to the PLUS-Quoted Market rules, to withdraw Europe Steel  Shares
from  the PLUS-Quoted Market.  This may be expected to reduce significantly  the
liquidity  of any Europe Steel Shares not directly acquired under the Offer.  By
accepting  the  Offer,  Shareholders will receive cash for  their  Europe  Steel
Shares  earlier  than  by waiting for compulsory purchase  and  will  avoid  any
associated dealing costs should they alternatively wish to sell in the market.

As  referred to above, Lord David Owen has excluded himself from considering, or
giving  any recommendation in respect of, the Offer.  However, it is Lord Owen's
intention to accept the Offer on the terms stated in this document in respect of
his   beneficial  shareholding  of  22,500  Europe  Steel  Shares,  representing
approximately 0.18 per cent. of the entire issued share capital of Europe Steel.

7.   Irrevocable undertakings to accept the Offer

Irrevocable undertakings to accept the Offer have been received in respect of  a
total  of  11,478,000 Europe Steel Shares, representing approximately 90.17  per
cent. of the entire issued share capital of Europe Steel.  The following persons
have  irrevocably  undertaken to accept the Offer in respect  of  the  specified
number of Europe Steel Shares.

                                 Number of Europe          % of issued
Name                                 Steel Shares        share capital

Vaimed Enterprises Limited              3,800,000                29.85
Vorsatel (BVI) Limited                  3,000,000                23.57
Bricklane Holdings Limited              2,000,000                15.71
Sigma International II LP               1,293,000                10.16
Emerging   Market  Economic
Research Limited                        1,200,000                 9.43
James Glynn West                           85,000                 0.67
High Octane Fund Limited                   50,000                 0.39
M&A Advisers Limited                       50,000                 0.39

All of the irrevocable undertakings will remain binding in the event of a higher
offer being made for Europe Steel, but will cease to be of any further force  or
effect  if  the Offer Document is not posted by   26 June 2008 or if  the  Offer
lapses or is withdrawn.

8.   Intentions regarding Europe Steel

The  FMC  Directors  attach  importance to the  skills  and  experience  of  the
management  team and employees of Europe Steel.  The FMC Directors  will  ensure
that  the  existing employment rights of the employees of Europe Steel  will  be
fully  safeguarded.   Following  the Offer becoming  or  being  declared  wholly
unconditional, the FMC Directors intend to integrate Europe Steel fully into the
FMC Group.  The integration of Europe Steel into the FMC Group will not have any
implications  in  respect  of  employment or  the  location  of  Europe  Steel's
activities.  Furthermore the FMC Directors have no intention to redeploy any  of
the fixed assets of Europe Steel.

9.   Current trading and prospects of Europe Steel

The  Company trades on a spot basis and does not maintain an order book. It  has
no exclusivity arrangements with either its supplier or with its customers.

The  level of sales achieved by Europe Steel during the first four months of the
current trading year, as indicated by management accounts, is approximately five
times  that for the same period of 2007. However, the Company's terms  of  trade
are  strongly influenced by its supplier, FMC, with the result that gross profit
margins have remained under significant pressure following their fall from  3.96
per  cent.  in  2006 to 2.77 per cent. in 2007. This trend has accelerated  such
that  gross margins have fallen to substantially lower levels in the first  four
months of this year and the Europe Steel Directors believe that this pressure on
gross  margins is likely to remain the prevailing business environment  for  the
Company for the foreseeable future.

10.  Europe Steel Share Option Scheme

There are no outstanding unexercised share options granted by Europe Steel.

11.  Financing of the Offer

The  cash  consideration  payable under the Offer will  be  funded  using  FMC's
existing  cash  resources.   Full acceptance under the  Offer  would  result  in
consideration  of  approximately £6.36 million being  payable  to  Europe  Steel
Shareholders.

BDO  Stoy  Hayward  Corporate  Finance is satisfied  that  sufficient  financial
resources are available to FMC to satisfy in full the cash consideration payable
to Europe Steel Shareholders in the event of full acceptance of the Offer.

12.  Disclosure of interests in Europe Steel Shares

As at the date of this announcement, Farhad Moshiri, who may be considered to be
a  person acting in concert with FMC by virtue of his business relationship with
Alisher  Usmanov, is interested in 22,500 Europe Steel Shares.  Save  for  this,
neither  FMC  nor, so far as the FMC Directors are aware, any person  acting  in
concert  with  FMC, has any interest in or right to subscribe for  any  relevant
securities  of  Europe Steel nor are they party to any short positions  (whether
conditional or absolute and whether in the money or otherwise) relating  to  the
relevant  securities  of  Europe  Steel  including  any  short  positions  under
derivatives, agreements to sell or any delivery obligations or rights to require
another person to take delivery.  Neither FMC nor the FMC Directors nor, so  far
as  the  FMC  Directors are aware, any person acting in concert  with  FMC,  has
borrowed or lent any relevant securities of Europe Steel.

13.  Compulsory acquisition and withdrawal of trading facility

If  the  Offer becomes or is declared unconditional in all respects, FMC intends
to  exercise  its  rights  under Chapter 3 of Part 28  of  the  Act  to  acquire
compulsorily the remaining Europe Steel Shares to which the Offer relates on the
same terms as the Offer.

If  the  Offer  becomes or is declared unconditional in all respects,  FMC  also
intends  to  procure that Europe Steel withdraws its shares from the PLUS-Quoted
Market.  Such withdrawal will take effect no earlier than 10 business days after
FMC  has  received valid acceptances for not less than 75 per  cent.  of  Europe
Steel Shares and its Offer has become or is declared wholly unconditional in all
respects  and subject to any applicable requirements of the PLUS-Quoted  Market.
The   FMC  Directors  believe  that  removal  of  this  trading  facility   will
significantly  reduce the liquidity of any Europe Steel Shares not  assented  to
the Offer at that time.

FMC  proposes  that following the Offer becoming or being declared unconditional
in all respects Europe Steel will be re-registered as a private company.

14.  General

Your  attention is drawn to the further information contained in the  Appendices
which form part of this announcement.

The  full  text  of the conditions of the Offer set out in Appendix  I  to  this
announcement  forms  part  of,  and should be read  in  conjunction  with,  this
announcement.

Appendix  II  to this announcement provides details of the basis of calculations
and sources of certain information included in this announcement.

Appendix III to this announcement contains definitions of certain terms used  in
this announcement.

In accordance with Rule 2.10 of the Code, Europe Steel confirms that as at close
of  business  on 28 May 2008 it had 12,729,700 ordinary shares  of  1p  each  in
issue.  The ISIN number for these securities is ISIN GB0003796694.

The Offer Document setting out in full the terms and conditions of the Offer  is
expected  to  be posted to Europe Steel Shareholders as soon as practicable  and
must,  in  any event, be posted to Europe Steel Shareholders not later  than  28
days after the date of this announcement unless otherwise agreed with the Panel.

For further information contact:

Ferrous Metal Company Limited

BDO Stoy Hayward Corporate Finance (Financial Adviser to FMC)

Michael Cobb                        +44 (0) 20 7486 5888
Suzanne Evans                       +44 (0) 20 7486 5888

Finsbury Limited (Financial PR)

Rollo Head                          +44 (0) 20 7251 3801
Simon Moyse                         +44 (0) 20 7251 3801

Europe Steel PLC

Blomfield Corporate Finance Limited (Financial Adviser to Europe Steel)

Alan MacKenzie                      +44 (0) 20 7489 4500
Emily Morgan                        +44 (0) 20 7489 4500
Peter Trevelyan-Clark               +44 (0) 20 7489 4500

BDO  Stoy  Hayward  Corporate  Finance, a division  of  BDO  Stoy  Hayward  LLP,
Chartered  Accountants,  which is authorised and regulated  in  the  UK  by  the
Financial  Services Authority, is acting for FMC and no one else  in  connection
with  the  Offer  and  will  not be responsible to anyone  other  than  FMC  for
providing  the  protections afforded to clients of BDO  Stoy  Hayward  Corporate
Finance  or for providing any financial advice in relation to the Offer  or  any
matter referred to herein.

Blomfield Corporate Finance, which is authorised and regulated in the UK by  the
Financial  Services Authority, is acting for Europe Steel and  no  one  else  in
connection  with  the  Offer and will not be responsible to  anyone  other  than
Europe  Steel  for  providing the protections afforded to clients  of  Blomfield
Corporate Finance or for providing any financial advice in relation to the Offer
or any matter referred to herein.

The  release,  distribution or publication of this announcement in jurisdictions
other  than  the UK may be restricted by law and therefore any persons  who  are
subject  to  the  laws  of  any jurisdiction other than  the  UK  should  inform
themselves  about  and  observe  any applicable  requirements.  Copies  of  this
announcement and any documentation relating to the Offer are not being, and must
not  be,  directly or indirectly, mailed or otherwise forwarded, distributed  or
sent  in or into or from any Restricted Jurisdiction and persons receiving  such
documents  (including  custodians, nominees  and  trustees)  must  not  mail  or
otherwise  forward,  distribute or send such documents in  or  into  or  from  a
Restricted  Jurisdiction.  The Offer (unless otherwise  determined  by  FMC  and
permitted  by  applicable  law and regulation) will not  be  made,  directly  or
indirectly,  in  or  into,  or by the use of the  mails,  or  by  any  means  of
instrumentality (including without limitation, telephonically or electronically)
of interstate or foreign commerce of, or any facilities of a national securities
exchange  of any Restricted Jurisdiction, and the Offer will not be  capable  of
acceptance from or within any Restricted Jurisdiction.

This  announcement, including information included or incorporated by  reference
in  this announcement, may contain "forward-looking statements" concerning  FMC,
Europe  Steel  and their respective subsidiaries. Generally, the  words  "will",
"may",   "should",   "could",  "continue",  "believes",  "expects",   "intends",
"anticipates"  or similar expressions identify forward-looking  statements.  The
forward-looking  statements  involve risks and uncertainties  that  could  cause
actual  results to differ materially from those expressed in the forward-looking
statements.  Many  of these risks and uncertainties relate to factors  that  are
beyond the companies' abilities to control or estimate precisely, such as future
market  conditions  and behaviours of other market participants,  and  therefore
undue  reliance  should not be placed on such statements. FMC and  Europe  Steel
assume  no  obligation,  and  do  not intend, to  update  these  forward-looking
statements, except as required pursuant to applicable law.

This announcement is not intended to and does not constitute or form any part of
an offer to sell or an invitation to purchase or the solicitation of an offer to
subscribe for any securities or the solicitation of any vote or approval in  any
jurisdiction pursuant to the Offer or otherwise. The Offer will be  made  solely
through the Offer Document and, in the case of certificated Europe Steel Shares,
the  Form  of  Acceptance,  which  will together  contain  the  full  terms  and
conditions  of  the  Offer, including details of how to accept  the  Offer.  Any
acceptance  or other response to the Offer should be made only on the  basis  of
the information contained in the Offer Document and the Form of Acceptance.

The  FMC  Directors accept responsibility for the information contained in  this
announcement  other  than that relating to Europe Steel  and  the  Europe  Steel
Group,  the  Europe  Steel  Directors and members of their  immediate  families,
related  trusts and persons connected with them.  To the best of  the  knowledge
and  belief of the FMC Directors (who have taken all reasonable care  to  ensure
that  such is the case), the information contained herein for which they  accept
responsibility is in accordance with the facts and does not omit anything likely
to affect the import of such information.

The  Europe Steel Directors accept responsibility for the information  contained
in  this  announcement  relating to Europe Steel, the  Europe  Steel  Group  and
themselves  and  their immediate families, related trusts and connected  persons
only,  save  in the case of one Europe Steel Director who is not an  Independent
Director who does not accept responsibility for the statement of an intention to
make a recommendation in respect of the Offer.  To the best of the knowledge and
belief  of  the  Europe Steel Directors (who have taken all reasonable  care  to
ensure  that  such is the case), the information contained in this document  for
which they take responsibility is in accordance with the facts and does not omit
anything likely to affect the import of such information.

Dealing disclosure requirements

Under  the  provisions of Rule 8.3 of the Code, if any person  is,  or  becomes,
"interested"  (directly or indirectly) in 1% or more of any class  of  "relevant
securities" of Europe Steel, all "dealings" in any "relevant securities" of that
company  (including  by  means  of an option in  respect  of,  or  a  derivative
referenced to, any such "relevant securities") must be publicly disclosed by  no
later  than 3.30 pm (London time) on the Business Day following the date of  the
relevant transaction. This requirement will continue until the date on which the
Offer  becomes, or is declared, unconditional as to acceptances,  lapses  or  is
otherwise  withdrawn or on which the "Offer Period" otherwise ends.  If  two  or
more  persons  act  together pursuant to an agreement or understanding,  whether
formal  or informal, to acquire an "interest" in "relevant securities" of Europe
Steel, they will be deemed to be a single person for the purpose of Rule 8.3.

Under  the  provisions  of  Rule 8.1 of the Code, all  "dealings"  in  "relevant
securities"  of  Europe  Steel  by FMC or Europe  Steel,  or  by  any  of  their
respective  "associates", must be disclosed by no later than 12.00 noon  (London
time) on the Business Day following the date of the relevant transaction.

A  disclosure  table,  giving  details  of  the  companies  in  whose  "relevant
securities" "dealings" should be disclosed, and the number of such securities in
issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk.

"Interests  in  securities" arise, in summary, when a person has  long  economic
exposure,  whether  conditional  or  absolute,  to  changes  in  the  price   of
securities.  In particular, a person will be treated as having an "interest"  by
virtue of the ownership or control of securities, or by virtue of any option  in
respect of, or derivative referenced to, securities.

Terms in quotation marks are defined in the Code, which can also be found on the
Panel's  website. If you are in any doubt as to whether or not you are  required
to disclose a "dealing" under Rule 8, you should consult the Panel.



                                   APPENDIX I

                             CONDITIONS OF THE OFFER

The  Offer will comply with the rules and regulations of the Financial  Services
Authority,  the applicable PLUS-Quoted Market rules and the Code,  and  will  be
governed  by  English law and any dispute arising in connection with  the  Offer
will  be  subject to the exclusive jurisdiction of the courts  of  England.   In
addition, the Offer will be subject to the terms and conditions set out in  this
Appendix 1, the further terms set out in the Offer Document and, in relation  to
Europe Steel Shares held in certificated form, the related Form of Acceptance.

1.   The Offer will be subject to the following conditions:

(a)  valid acceptances being received (and not, where permitted, withdrawn)  by
not  later  than 1.00 p.m. (London time) on the first closing date of the  Offer
(or  such later time(s) and/or date(s) as FMC may, subject to the rules  of  the
Code  or  with the consent of the Panel, decide) in respect of not less than  90
per cent. in nominal value of the Europe Steel Shares to which the Offer relates
and  not less than 90 per cent. of the voting rights carried by the Europe Steel
Shares  to  which the Offer relates, provided that this condition  will  not  be
satisfied  unless FMC (together with its wholly owned subsidiaries)  shall  have
acquired  or  agreed  to acquire (whether pursuant to the  Offer  or  otherwise)
directly  or indirectly Europe Steel Shares carrying in aggregate more  than  50
per cent. of the voting rights then normally exercisable at general meetings  of
Europe Steel, including for this purpose (except to the extent, if any, required
by  the Panel) any such voting rights attaching to any Europe Steel Shares  that
are  unconditionally allotted or issued before the Offer becomes or is  declared
unconditional  as  to  acceptances, whether pursuant  to  the  exercise  of  any
outstanding subscription or conversion rights or otherwise.
For the purposes of this condition:

    (i) Europe Steel Shares which have been unconditionally allotted shall be
    deemed to carry the voting rights they will carry upon issue;

    (ii) the expression "Europe Steel Shares to which the Offer relates" shall
    be construed in accordance with Part 28 of the Act; and

    (iii) valid acceptances shall be deemed to have been received in respect of
    any Europe Steel Shares which FMC shall, pursuant to section 979(8) of the
    Act, be treated as having acquired or contracted to acquire by virtue of
    acceptance of the Offer;

(b) no government, government department, or governmental, quasi-governmental,
supranational,  statutory  or  regulatory  body,  or  any  court,   institution,
investigative  body, association, trade agency or professional or  environmental
body  or (without prejudice to the generality of the foregoing) any other person
or  body  in  any jurisdiction (each, a "Relevant Authority") having decided  to
take,  instituted,  implemented  or threatened any  action,  proceedings,  suit,
investigation,  reference or enquiry or enacted, made or proposed  any  statute,
regulation  or  order or otherwise taken any other step or  done  anything,  and
there  not  being  outstanding any statute, legislation  or  order,  that  would
reasonably be expected to:

     (i)  restrict,  restrain, prohibit, delay, impose additional conditions  or
     otherwise  challenge or require the amendment of obligations  with  respect
     to, or otherwise interfere with the implementation of, or impose additional
     conditions or obligations which FMC considers material with respect to, the
     Offer  or the acquisition of any Europe Steel Shares by FMC or the  control
     of Europe Steel by FMC;

     (ii)  require, prevent, delay or affect the divestiture by Europe Steel  or
     FMC or any of Europe Steel's or FMC's subsidiaries, subsidiary undertakings
     or  associated undertakings (including any company, any partnership,  joint
     venture or firm in which any of them have a direct or indirect interest  of
     20  per  cent.  or more of the voting or equity capital or the  equivalent)
     (together  respectively the "wider Europe Steel Group" and the  "wider  FMC
     Group") of all or any portion of their businesses, assets or property or of
     any  Europe Steel Shares or other securities (or the equivalent) in  Europe
     Steel  or  impose any limitation on the ability of any of them  to  conduct
     their respective businesses or own their respective assets or properties or
     any part thereof to an extent which is material in the context of the Offer
     or  the  wider Europe Steel Group taken as a whole, or as the case may  be,
     the wider FMC Group taken as a whole;

     (iii) impose any material limitation on, or result in a material delay  in,
     the  ability  of  the wider FMC Group or the wider Europe  Steel  Group  to
     acquire, hold or exercise effectively, directly or indirectly, all  or  any
     rights  of  ownership  in  respect of shares or other  securities  (or  the
     equivalent) in, or to exercise management control over, any member  of  the
     wider Europe Steel Group in each case to an extent which is material in the
     context of the Offer;

     (iv) except pursuant to Part 28 of the Act, require the wider FMC Group  or
     any  member of the wider Europe Steel Group to offer to acquire any  shares
     or  other  securities (or the equivalent) or rights thereover  of,  or  any
     material  asset  of  Europe Steel or any member of the wider  Europe  Steel
     Group  owned by any third party or to sell or offer to sell any  shares  or
     other  securities  (or  the  equivalent) or rights  thereover  of,  or  any
     material  asset  owned by Europe Steel or any member of  the  wider  Europe
     Steel Group where such acquisition would be material in the context of  the
     Offer;

     (v)  make  the Offer or its implementation or the acquisition  or  proposed
     acquisition of Europe Steel the wider Europe Steel Group or of  any  Europe
     Steel  Shares or any other shares or securities in, or control  of,  Europe
     Steel  by FMC, illegal, void and/or unenforceable in or under the  laws  of
     any jurisdiction;

     (vi)  impose any material limitation on the ability of the wider FMC  Group
     or  any  member of the wider Europe Steel Group to integrate or co-ordinate
     its  business,  or  any part of it, with all or any material  part  of  the
     business  of  the wider FMC Group taken as a whole or of the  wider  Europe
     Steel Group taken as a whole;

     (vii)  result  in a delay in the ability of FMC, or render FMC  unable,  to
     acquire  some  or all of the Europe Steel Shares or require,  or  where  so
     required  prevent or delay, the divestiture by FMC of any  such  shares  or
     other securities of Europe Steel;

     (viii) result in any member of the wider Europe Steel Group ceasing  to  be
     able to carry on its business under any name which it at present uses to an
     extent which is material in the context of the Offer; or

     (ix)  otherwise  adversely  affect any or all of  the  businesses,  assets,
     prospects  or  profits of the wider FMC Group or any member  of  the  wider
     Europe  Steel  Group to an extent which is material in the context  of  the
     Offer,

and  all  applicable waiting and other time periods during which  such  Relevant
Authority  could  decide to institute, implement or threaten  any  such  action,
proceeding,  suit,  investigation, enquiry or reference or  otherwise  intervene
having expired, lapsed or been terminated;

(c)  no  indication  having been given by the Office of Fair  Trading  that  the
proposed  acquisition  of  Europe  Steel will be  referred  to  the  Competition
Commission  (as  established under section 4 of the  Competition  Act  1998,  as
amended);

(d)   all   authorisations,   orders,   grants,   recognitions,   confirmations,
certificates,  consents,  clearances,  licences,  permissions,  exemptions   and
approvals,  in any jurisdiction, necessary for or in respect of the  Offer,  the
proposed acquisition of any shares or securities in, (except pursuant to Part 28
of  the Act) or control of, Europe Steel or any member of the wider Europe Steel
Group  by  FMC  or the carrying on of the business of any member  of  the  wider
Europe Steel Group or FMC being obtained on terms reasonably satisfactory to FMC
from  all  appropriate  Relevant  Authorities  or  (without  prejudice  to   the
generality of the foregoing) from any persons or bodies with whom any members of
the wider Europe Steel Group or FMC has entered into contractual arrangements in
each case where the absence of the same would have a material adverse effect  on
FMC  or  the  FMC  Group and such authorisations, orders, grants,  recognitions,
confirmations,  certifications,  consents,  clearances,  licences,  permissions,
exemptions and approvals remaining in full force and effect at the time at which
the  Offer  becomes or is otherwise declared unconditional in all respects,  and
there  being no notice of any intention to revoke, modify, suspend, restrict  or
not  to  renew the same and all necessary filings and applications  having  been
made,  all  appropriate  waiting  and other time periods  (including  extensions
thereto)  under  any applicable legislation and regulations  in  any  applicable
jurisdiction  having  expired,  lapsed or  been  terminated  and  all  necessary
statutory or regulatory obligations in any jurisdiction in respect of the  Offer
in  each  case as may be necessary in connection with the Offer or the  proposed
acquisition  of  Europe Steel by FMC or of any Europe Steel Shares  having  been
complied with in all material respects;

(e) no notice having been received by any member of the wider Europe Steel Group
from  the  Relevant Authorities or any party with whom any member of  the  wider
Europe  Steel  Group  has any contractual or other relationship,  (i)  that  the
interests  held  by any member of the wider Europe Steel Group  under  licences,
leases, consents, permits and other rights will be materially (in the context of
the  wider  Europe Steel Group taken as a whole) adversely amended or  otherwise
affected by the Offer or the proposed acquisition of Europe Steel, and (ii) that
such  licences, leases, consents, permits and other rights have ceased to be  in
full  force  and effect and (iii) that there is an intention to revoke,  modify,
suspend, restrict, limit or amend any of the same;

(f)  except as fairly disclosed to FMC or its advisers by or on behalf of Europe
Steel prior to 29 May 2008 or as otherwise publicly announced by Europe Steel to
a  Regulatory Information Service prior to 29 May 2008 or as disclosed in Europe
Steel's  annual report and accounts for the year ended 31 December  2007,  there
being no provision of any agreement, instrument, permit, licence, lease or other
arrangement to which any member of the wider Europe Steel Group is a party or by
or  to which any member of the wider Europe Steel Group or any of its assets may
be bound, or subject, which, as a consequence of the Offer or the acquisition or
the  proposed acquisition by FMC of the Europe Steel Shares or any  of  them  or
because  of a change in the control or management of Europe Steel or any  member
of  the wider Europe Steel Group, could or might reasonably be expected to  have
the  result  that (in each case to an extent which is or would be  material  and
adverse in the context of the wider Europe Steel Group taken as a whole):

     (i)  any  moneys borrowed by, or other indebtedness, actual or  contingent,
     of, or grant available to, any member of the wider Europe Steel Group is or
     becomes  repayable  or capable of being declared repayable  immediately  or
     earlier  than  the repayment date stated in such agreement,  instrument  or
     other  arrangement or the ability of any member of the wider  Europe  Steel
     Group  to borrow moneys or incur indebtedness is withdrawn or inhibited  or
     adversely affected;

     (ii) any mortgage, charge or other security interest is created or enforced
     over  the  whole  or any part of the business, property or  assets  of  any
     member  of the wider Europe Steel Group or any such security (whenever  and
     wherever arising or having arisen) becomes enforceable;

     (iii) any such agreement, instrument, permit, licence or other arrangement,
     or  any right, interest, liability or obligation of any member of the wider
     Europe Steel Group therein, is terminated or adversely modified or affected
     or any adverse action is taken or onerous obligation arises thereunder;
     (iv)  the  value  of any member of the wider Europe Steel  Group  or  their
     respective  financial  or  trading position  or  profits  or  prospects  is
     prejudiced or adversely modified in each case to a material extent;

     (v) any asset or interest, the use of which is enjoyed by any member of the
     wider Europe Steel Group, being or falling to be charged or disposed of  or
     any  right arising under which any such asset or interest could be required
     to  be disposed of or charged or could cease to be available to FMC or  any
     member of the wider Europe Steel Group, in each case otherwise than in  the
     ordinary course of business;

     (vi)  the assets, rights, liabilities, obligations or interests or business
     of  any  member of the wider Europe Steel Group under any such arrangement,
     agreement,  licence, permit, lease or instrument or in or  with  any  other
     person,  firm or company (or any arrangement relating to such  interest  or
     business)  is terminated or modified or affected in either case  materially
     and  adversely or any material onerous obligations arising or any  material
     and adverse actions being taken thereunder;

     (vii) any member of the wider Europe Steel Group ceases to be able to carry
     on business under any name under which it currently does so;

     (viii)  any change in or effect on the ownership or use of any intellectual
     property  rights  owned  or used by any member of the  wider  Europe  Steel
     Group; or

     (ix)  any  liabilities (actual or contingent) which are created,  arise  or
     become  apparent in any member of the wider Europe Steel Group, other  than
     in the ordinary course of business,

     and  no  event having occurred which, under any provision of any agreement,
     arrangement, licence or other instrument to which any member of  the  wider
     Europe  Steel Group is a party or by or to which any such member or any  of
     its  assets are bound or subject, would be reasonably likely to  result  in
     any  events or circumstances as are referred to in paragraphs (i)  to  (ix)
     above;

(g) since 31 December 2007 (being the date to which the latest published audited
report  and  accounts  of Europe Steel were made up) and save  as  disclosed  in
Europe Steel's published report and accounts for the year ended 31 December 2007
or  save  as  announced  publicly by Europe Steel to  a  Regulatory  Information
Service  prior to 29 May 2008 or save as fairly disclosed to FMC or its advisers
by  or  on  behalf  of  Europe Steel no member of the wider Europe  Steel  Group
having:

     (i)  issued  or  agreed  to issue or authorised or proposed  the  issue  of
     additional shares of any class, or granted securities convertible  into  or
     exchangeable  for,  or  rights, warrants or options  to  subscribe  for  or
     acquire  such shares or convertible securities or transferred or  sold  any
     shares  out  of  treasury  or redeemed, purchased,  reduced  or  repaid  or
     announced  any intention or proposal to do so or made any other  change  to
     any part of its share capital;

     (ii) recommended, declared, paid or made or proposed to recommend, declare,
     pay  or  make  any  dividend,  bonus issue or other  distribution,  whether
     payable in cash or otherwise, other than dividends lawfully paid to  Europe
     Steel  or  to  a member of the wider Europe Steel Group which is  a  wholly
     owned subsidiary of Europe Steel;

     (iii)  authorised  or proposed or announced its intention  to  propose  any
     merger  or  acquisition  or disposal or transfer  of  any  body  corporate,
     partnership  or  business  or otherwise than  in  the  ordinary  course  of
     business,  acquired, transferred, disposed, mortgaged, charged  or  created
     any  security interest over any assets or any right, title or  interest  in
     any  asset  (including shares and trade investments) or any change  in  its
     share or loan capital;

     (iv) issued or authorised or proposed the issue of any debentures;

     (v)  otherwise  than  in  the  ordinary course  of  business,  incurred  or
     increased any indebtedness or contingent liability which would be  material
     in the context of the wider Europe Steel Group taken as a whole;

     (vi) disposed of or transferred, mortgaged or encumbered any material asset
     or  any  right, title or interest in any such asset or authorised, proposed
     or announced any intention to do so;

     (vii)  entered into, varied or terminated other than in the ordinary course
     of  business any contract, commitment or arrangement (whether in respect of
     capital expenditure, trading obligations or otherwise) which is of  a  loss
     making,  long  term, onerous or unusual nature or which involves  or  could
     involve  an  obligation of a nature or magnitude which, in  each  case,  is
     material in the context of the wider Europe Steel Group taken as a whole or
     authorised, proposed or announced any intention to do so;

     (viii)  entered  into, varied the terms of or terminated, any  contract  or
     agreement  (including any service agreement) with any of the  directors  or
     senior executives of Europe Steel or its subsidiaries;

     (ix)  proposed, agreed to provide or modified the terms of any share option
     scheme or incentive scheme of the wider Europe Steel Group;

     (x) save as between Europe Steel and its wholly owned subsidiaries, granted
     any  material  lease  or  licence in respect of any  of  the  leasehold  or
     freehold  property  owned  or occupied by it or  transferred  or  otherwise
     disposed of any such property;

     (xi) taken or proposed any corporate action to the extent which is material
     in  the context of the Europe Steel Group taken as a whole or had any legal
     proceedings instituted or threatened in relation to or against it  for  its
     winding-up (voluntary or otherwise), dissolution or reorganisation  or  for
     it  to enter into a compromise of its debts or scheme of arrangement of its
     affairs or for the appointment of a receiver, administrator, administrative
     receiver,  trustee  or  similar officer of all or any  of  its  assets  and
     revenues  or  any  analogous proceedings in any  jurisdiction  or  for  the
     appointment of any analogous person in any jurisdiction;

     (xii) taken any action to commence or institute any legal proceedings or to
     settle,  compromise or discontinue any legal proceedings which have already
     been  commenced  or  suffered  any claims  or  had  any  legal  proceedings
     instituted against it or admitted liability in any such claim or proceeding
     or  taken  any action to settle or compromise any such claim or proceedings
     which,  in each case, is material in the context of the wider Europe  Steel
     Group taken as a whole;

     (xiii)  waived  or compromised any claim or authorised any such  waiver  or
     compromise which is material in the context of the wider Europe Steel Group
     as a whole;

     (xiv)  entered  into,  implemented, effected, authorised,  or  proposed  or
     announced  its  intention to enter into, implement,  effect,  authorise  or
     propose  any  merger,  demerger,  scheme,  reconstruction  or  amalgamation
     otherwise than in the ordinary course or business;

     (xv)  made any amendment to its memorandum or articles of association which
     is material in the context of the Offer;

     (xvi)  entered  into  or  varied or terminated or authorised,  proposed  or
     announced  its  intention  to enter into, vary or terminate  any  contract,
     transaction, commitment or arrangement which is restrictive on the business
     of  any member of the wider Europe Steel Group or FMC and which is material
     in the context of the wider Europe Steel Group taken as a whole;

     (xvii) been unable or admitted that it is unable to pay its debts or having
     stopped  or  suspended (or threatened to stop or suspend)  payment  of  its
     debts  generally  or ceased or threatened to cease carrying  on  all  or  a
     substantial part of its business;

     (xviii)  purchased, redeemed or repaid or proposed the purchase, redemption
     or  repayment  of any of its own shares or other securities or  reduced  or
     made  any other changes to any part of its share capital to an extent which
     is  material  in  the context of the wider Europe Steel Group  taken  as  a
     whole; or

     (xix) entered into or made any offer (which remains open for acceptance) to
     enter into any contract, commitment, agreement or arrangement or passed any
     resolution with respect to, or to effect, any of the transactions,  matters
     or  events  referred to in this condition (g), or announced or proposed  an
     intention to do so;

(h)  since 30 April 2008 (being the date to which the latest management accounts
of  Europe Steel were made up) and save as disclosed in Europe Steel's published
report  and  accounts for the year ended 31 December 2007 or save  as  announced
publicly prior to 29 May 2008 or save as fairly disclosed in writing to  FMC  or
its advisers prior to 29 May 2008 by or on behalf of Europe Steel:

     (i)  no  litigation or arbitration proceedings, prosecution or other  legal
     proceedings  having  been  instituted, announced or  threatened  or  become
     pending  or  remained  outstanding by or against any member  of  the  wider
     Europe  Steel Group or to which any member of the wider Europe Steel  Group
     is or reasonably expects to become a party (whether as plaintiff, claimant,
     defendant or otherwise) and no enquiry or investigation by or complaint  or
     reference to any Relevant Authority against or in respect of any member  of
     the  wider  Europe  Steel  Group  having  been  threatened,  announced   or
     instituted or remaining outstanding by, against or in respect of any member
     of  the  wider  Europe Steel Group in each case which is  material  in  the
     context of the wider Europe Steel Group taken as a whole;

     (ii)  no  adverse change or deterioration having occurred in the  business,
     assets (including cash balances), financial or trading position, profits or
     prospects of any member of the wider Europe Steel Group in each case  which
     is  material  in  the context of the wider Europe Steel Group  taken  as  a
     whole;

     (iii)  no  contingent or other liability of any member of the wider  Europe
     Steel  Group having arisen or become apparent which is or might  reasonably
     be  expected  to be materially adverse in the context of the  wider  Europe
     Steel Group taken as a whole; or

     (iv) no steps have been taken and no admissions having been made which  are
     likely   to   result  in  the  withdrawal,  cancellation,  termination   or
     modification  of any licence held by any member of the wider  Europe  Steel
     Group,  which  is necessary for the proper carrying on of its business  and
     the  withdrawal, cancellation, termination or modification of which  is  or
     might  reasonably be expected to be material in the context  of  the  wider
     Europe Steel Group taken as a whole;

(i) after the date of this announcement FMC not having discovered that:

     (i)  any business, financial or other information concerning any member  of
     the wider Europe Steel Group that has been disclosed, publicly or otherwise
     at any time to FMC, by or on behalf of any member of the wider Europe Steel
     Group,  is  misleading, contains a misrepresentation of fact  or  omits  to
     state  a  fact  necessary  to make the information  contained  therein  not
     misleading  which  in  each case is material in the context  of  the  wider
     Europe Steel Group taken as a whole; or

     (ii) any member of the wider Europe Steel Group, or any entity in which any
     such  member  has  a  significant economic  interest,  is  subject  to  any
     liability,  actual  or  contingent, which is not disclosed  in  the  annual
     report  and  accounts  of  Europe Steel for the  financial  year  ended  31
     December  2007  or in the Offer Document or has not otherwise  been  fairly
     disclosed to FMC or its advisers by or on behalf of Europe Steel  prior  to
     29  May 2008 and which is material in the context of the wider Europe Steel
     Group taken as a whole;

(j) after the date of this announcement FMC not having discovered that:

     (i)  any present member of the wider Europe Steel Group, or any past member
     of  the  wider Europe Steel Group for whose acts or omissions mentioned  in
     this  paragraph (j)(i) any present member of the wider Europe  Steel  Group
     may  be  held  liable,   has not complied with any  and/or  all  applicable
     legislation  or  regulations  of  any  jurisdiction  (or  any  notices   or
     requirements of any Relevant Authority in any jurisdiction) with regard  to
     the  use, treatment, handling, storage, disposal, discharge, spillage, leak
     or  emission of any waste or hazardous substance or any substance likely to
     impair  the  environment or to harm human health or otherwise  relating  to
     environmental,  health or safety matters (which non-compliance  might  give
     rise to any liability (whether actual or contingent) or cost on the part of
     any  member of the wider Europe Steel Group) which would be material to the
     wider Europe Steel Group taken as a whole or that there has otherwise  been
     any  such use, treatment, handling, storage, disposal, discharge, spillage,
     leak  or emission (whether or not the same constituted a non-compliance  by
     any  person with any such legislation or regulations and wherever the  same
     may  have  taken  place)  which in any such case might  give  rise  to  any
     liability (whether actual or contingent) or cost on the part of any  member
     of  the wider Europe Steel Group and which would be material in the context
     of the wider Europe Steel Group taken as a whole;

     (ii)  there is, or is reasonably likely to be, any obligation or  liability
     (whether  actual or contingent), or any request by any Relevant  Authority,
     to make good, repair, reinstate or clean up any property or other asset now
     or  previously owned, occupied or made use of by either any present  member
     of  the  wider  Europe Steel Group, or any past member of the wider  Europe
     Steel Group for whose acts or omissions mentioned in this paragraph (j)(ii)
     any  present member of the wider Europe Steel Group may be held liable,  or
     in  which such member may now have or previously has had an interest  under
     any  environmental  legislation,  regulation,  decision  or  order  of  any
     Relevant  Authority or third party or otherwise which,  in  each  case,  is
     material in the context of the wider Europe Steel Group taken as a whole;
     (iii) any Relevant Authority instituting, or any member of the wider Europe
     Steel  Group or FMC being required to institute, an environmental audit  or
     take  any other steps which in any such case is reasonably likely to result
     in  any  actual or contingent liability or cost to improve or  install  new
     plant  or  equipment, to pay a fine or be subject to any legal proceedings,
     or make good, repair, re-instate or clean up any land or other asset now or
     previously owned, occupied or made use of by any member of the wider Europe
     Steel  Group  in each case which is material in the context  of  the  wider
     Europe Steel Group taken as a whole; or

     (iv)  circumstances  exist whereby a person or class of  persons  would  be
     likely to have any claim or claims in respect of any product or process  of
     manufacture or materials used therein now or previously manufactured,  sold
     or  carried out by any present member of the wider Europe Steel  Group,  or
     any past member of the wider Europe Steel Group for whose acts or omissions
     mentioned in this paragraph (j)(iv) any present member of the wider  Europe
     Steel  Group  may  be held liable, in each case which is  material  in  the
     context of the wider Europe Steel Group taken as a whole.

Waiver and invocation of Conditions

Subject to the requirements of the Panel, FMC reserves the right at its absolute
discretion to waive all or any of conditions (b) to (j) (inclusive), in whole or
in  part. The Offer will lapse unless the conditions (b) to (j) (inclusive) have
been  fulfilled  or  (if capable of waiver) waived, or, where appropriate,  have
been  determined by FMC in its reasonable opinion to be or remain satisfied,  by
midnight  on the day which is 21 days after the later of the first closing  date
of  the  Offer  and  the  date  on  which  the  Offer  becomes  or  is  declared
unconditional as to acceptances, or such later date as FMC may, with the consent
of the Panel, decide, provided that FMC shall be under no obligation to waive or
treat  as  fulfilled any of conditions (b) to (j) (inclusive) by a date  earlier
than  the latest date specified or referred to above for the fulfilment  thereof
notwithstanding that the other conditions of the Offer may at such earlier  date
have  been  waived  or  fulfilled and that there are at  such  earlier  date  no
circumstances  indicating that any of such conditions  may  not  be  capable  of
fulfilment.

If  FMC  is  required by the Panel to make an offer or offers for  Europe  Steel
Shares under the provisions of Rule 9 of the Code, FMC may make such alterations
to the conditions as are necessary to comply with the provisions of that rule.

The  conditions  are  for  the  benefit of FMC and  none  of  the  Europe  Steel
Shareholders shall be entitled to waive any of the conditions without the  prior
consent of FMC.

Europe  Steel Shares will be acquired by FMC fully paid and free from all liens,
equitable interests, charges, encumbrances and other third party rights  of  any
nature whatsoever and together with all rights attaching to them, including  the
right  to  receive and retain all dividends and distributions (if any) declared,
made or payable after the date of this announcement.

                                   APPENDIX II

                        BASES AND SOURCES OF INFORMATION

  1    The value attributed to the entire issued share capital of Europe Steel is
       based upon the 12,729,700 Europe Steel Shares in issue as at the date of this
       announcement.

  2    Unless  otherwise  stated, all prices for Europe Steel Shares  have  been
       derived from www.plusmarketsgroup.com and represent the closing middle market
       prices on the relevant date.

  3    References to a percentage of Europe Steel Shares are based on the number
       of Europe Steel Shares in issue as set out in paragraph 1 above.

  4    Unless otherwise stated:

       (a) financial  information relating to FMC and the wider  FMC  Group
           has  been extracted or provided (without material adjustment) from the
           audited  annual  report and accounts for FMC for  the  year  ended  31
           December   2007  reported  under  International  Financial   Reporting
           Standards; and

       (b) financial  information relating to Europe  Steel  and  the  wider
           Europe  Steel  Group has been extracted or provided (without  material
           adjustment)  from  the audited annual report and accounts  for  Europe
           Steel  for the year ended 31 December 2007 reported under UK Generally
           Accepted Accounting Principles.


                                    APPENDIX III

                                     DEFINITIONS

  In  this  announcement, unless the context otherwise requires,  the  following
  expressions have the following meanings:

  `Act'                                       Companies Act 2006.

  `Australia'                                 the  Commonwealth  of
                                              Australia, its states,
                                              territories and possessions
                                              and  all  areas subject
                                              to its jurisdiction and all
                                              political sub divisions
                                              thereto.

  `Blomfield Corporate Finance'               Blomfield         Corporate
                                              Finance  Limited, which  is
                                              authorised  and   regulated
                                              in  the UK by the Financial
                                              Services         Authority,
                                              financial    adviser     to
                                              Europe Steel.

  `Boards'                                    the  board of directors  of
                                              Ferrous  Metal Company  and
                                              Europe Steel.

  `BDO Stoy Hayward Corporate Finance'        BDO  Stoy Hayward Corporate
                                              Finance, a division of  BDO
                                              Stoy      Hayward      LLP,
                                              Chartered      Accountants,
                                              which  is  authorised   and
                                              regulated in the UK by  the
                                              Financial          Services
                                              Authority   to   carry   on
                                              investment        business,
                                              financial adviser to FMC.

  `Business Day'                              a  day (other than Saturday
                                              or    Sunday)   on    which
                                              clearing     banks      are
                                              generally  open  for  usual
                                              business  in  the  City  of
                                              London.

  `Canada'                                    Canada,  its provinces  and
                                              territories and  all  areas
                                              under its jurisdiction  and
                                              political     sub-divisions
                                              thereof.

  `Closing Price'                             the  closing middle  market
                                              price  of  an Europe  Steel
                                              Share   as   derived   from
                                              www.plusmarketsgroup.com.

  `Code'                                      The Takeover Code.

  `Europe Steel' or the `Company'             Europe Steel PLC.

  `Europe Steel Directors'                    the   directors  of  Europe
                                              Steel  at the date of  this
                                              announcement   being    The
                                              Right  Honourable The  Lord
                                              Owen,  John  M Maguire  and
                                              Patrick J Kevans.

  `Europe Steel Group'                        Europe   Steel   and    its
                                              subsidiaries and
                                              subsidiary undertakings.

  `Europe Steel Shares'                       the                existing
                                              unconditionally    allotted
                                              or    issued   fully   paid
                                              ordinary shares of 1  pence
                                              each  in  the share capital
                                              of  Europe  Steel  and  any
                                              further  such shares  which
                                              are         unconditionally
                                              allotted  or  issued  prior
                                              to   the  date  the   Offer
                                              closes   (or  such  earlier
                                              date  as  FMC  (subject  to
                                              the  Code)  may decide  not
                                              being   earlier  than   the
                                              date  on  which  the  Offer
                                              becomes   or  is   declared
                                              unconditional     as     to
                                              acceptances).

  `Europe Steel Shareholders'                 holders  of  Europe   Steel
                                              Shares.

  `Ferrous Metal Company'  or                 Ferrous    Metal    Company
  `FMC'                                       Limited.

  `FMC Directors'                             the  directors  of  Ferrous
                                              Metal  Company at the  date
                                              of    this    announcement,
                                              being   Moshe  Fengas   and
                                              Gordon L Sellors.

  `FMC Group'                                 Ferrous  Metal Company  and
                                              its     subsidiaries    and
                                              subsidiary undertakings.

  `Form of Acceptance'                        the  form of acceptance and
                                              authority relating  to  the
                                              Offer  to  be completed  by
                                              Europe  Steel  Shareholders
                                              who   hold   Europe   Steel
                                              Shares    in   certificated
                                              form   and  who   wish   to
                                              accept the Offer.

  `FSA'                                       the    Financial   Services
                                              Authority.

  `Independent Directors'                     the   directors  of  Europe
                                              Steel,  save for The  Right
                                              Honourable The Lord Owen.

  `Japan'                                     Japan,      its     cities,
                                              prefectures,    territories
                                              and possessions.

  `Listing Rules'                             the  listing rules made  by
                                              the  FSA under Part  IV  of
                                              the  Financial Services and
                                              Markets Act 2000.

  `Offer'                                     the  recommended  offer  to
                                              be  made  by FMC to acquire
                                              the  entire issued  and  to
                                              be  issued share capital of
                                              Europe  Steel on the  terms
                                              and    subject    to    the
                                              conditions set out  in  the
                                              Offer   Document  and   the
                                              Form   of  Acceptance  and,
                                              where   the   context    so
                                              requires,   any  subsequent
                                              revision,        variation,
                                              extension,  or  renewal  of
                                              such offer.

  `Offer Price'                               50   pence   in  cash   per
                                              Europe Steel Share.

  `Offer Document'                            the    document    to    be
                                              published   and   sent   to
                                              Europe  Steel  Shareholders
                                              containing the Offer.

  `Panel'                                     The Takeover Panel.

  `PLUS-Quoted Market'                        the    exchange   regulated
                                              market  operated  by   PLUS
                                              Markets  PLC known  as  the
                                              PLUS-quoted market.

  `pounds' or `£'                             UK pounds Sterling.

  `Regulatory                                 Information any  of  the  services  set
  Service'                                    out  in  Appendix 3 to  the
                                              Listing Rules.

  `Restricted Jurisdiction'                   subject   always   to   the
                                              requirements of  Rule  30.3
                                              of  the Code in relation to
                                              the  distribution of  offer
                                              documentation            to
                                              jurisdictions  outside  the
                                              UK,  any jurisdiction where
                                              extension or acceptance  of
                                              the   Offer  would  violate
                                              the     law     of     that
                                              jurisdiction.

  `UK' or the `United Kingdom'                the   United   Kingdom   of
                                              Great  Britain and Northern
                                              Ireland  (and its dependent
                                              territories).

  `United  States of America'                 the   United   States    of
  or `United States' or `US'                  America,   its  territories
                                              and  possessions, any state
                                              of  the  United  States  of
                                              America  and  the  District
                                              of Columbia.

  The  expressions  `subsidiary',  `subsidiary undertaking',  `undertaking'  and
  `associated  undertaking' have the meanings given by the  Companies  Act  1985
  including  any  statutory modification or re-enactment thereof  for  the  time
  being  in  force  (but  for  the  purpose of  the  definition  of  "associated
  undertaking"  ignoring paragraph 20(1)(b) of Schedule 4A of the Companies  Act
  1985 or any statutory re-enactment thereof for the time being in force).   All
  references to time in this document are to London time.

  Words  importing  the singular shall include the plural and  vice  versa,  and
  words  importing  the masculine gender shall include the  feminine  or  neural
Data provided by FE. Care has been taken to ensure that the information is correct, but FE neither warrants, represents nor guarantees the contents of information, nor does it accept any responsibility for errors, inaccuracies, omissions or any inconsistencies herein. Past performance does not predict future performance, it should not be the main or sole reason for making an investment decision. The value of investments and any income from them can fall as well as rise.

You are currently using an old browser which will not be supported by Trustnet after 31/07/2016. To ensure you benefit from all features on the site, please update your browser.   Close