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Capital market-relevant press releases, 2007-06-07, 02:36 PM

ThyssenKrupp Acciai Speciali Terni strengthens competitiveness –production relocation from Turin to Terni

ThyssenKrupp Acciai Speciali Terni, Italy’s only manufacturer of stainless steel flat products, is taking the next steps to strengthen its competitiveness. An extensive program of measures will expand the capacity of the plant in Terni in the medium term and bring it to a standard comparable with the best of its competitors. “The purpose of the investments we have made and those still underway is to expand the integrated stainless mill in Terni into an internationally competitive site,” says Dr. Harald Espenhahn, Chairman of the Management Board of ThyssenKrupp Acciai Speciali Terni: “We have kept all the promises we made in connection with the ending of electrical steel production two years ago.”

As part of the further optimization, the company is now step-by-step relocating the entire production capacity of Turin to Terni. The narrowly 400 employees in Turin will be offered jobs within the company. Older employees will also have the opportunity to take early retirement. The employee representatives and the workforce were informed of this today by the Management Board of ThyssenKrupp Acciai Speciali Terni.

Relocating cold-rolled production from Turin to Terni will further optimize the competitiveness of ThyssenKrupp Acciai Speciali Terni. “This step isn’t easy for us but it is unavoidable for economic reasons and with a view to the future of the company as a whole,” said Dr. Harald Espenhahn: “We want to create production and cost structures similar to those of our best competitors.” The Turin site has significant disadvantages in terms of logistics, energy costs, infrastructure and environmental requirements. The high cost of transporting coils between the Terni and Turin sites is a particular disadvantage for ThyssenKrupp Acciai Speciali Terni compared with its competitors.

After the phasing-out of production, the equipment in Turin will be completely dismantled and some items will be relocated to Terni. According to current plans, the closure of the site will be completed by the end of fiscal 2007/08. All employees will be offered a job within the AST group. “We need skilled personnel to continue our successful growth course,” says Dr. Espenhahn: “Our company would not be the success it is without the reliability, commitment and professionalism of our employees.”

Since being acquired in 1994, ThyssenKrupp Acciai Speciali Terni has seen significant investment. The parent company ThyssenKrupp Stainless launched an additional capital expenditure program two years ago. Instead of the agreed 124 million euros, around 300 million euros has been invested in ThyssenKrupp Acciai Speciali Terni since early 2005 alone. For example, a further cold rolling mill, a finishing center and a new training center have been built. A new annealing and pickling line and a new VOD converter for developing ferritic stainless steels are under construction. At Società delle Fucine, which operates Europe’s largest forging press, new equipment will be installed from 2008 which will enhance performance capability and enable the ThyssenKrupp Acciai Speciali Terni subsidiary to produce parts weighing up to around 250 tons.

The various measures will increase stainless production in Terni from 570,000 to nearly 700,000 tons of cold-rolled per year in the future, creating the conditions at ThyssenKrupp Acciai Speciali Terni for the highest levels of steel quality, optimized processing capabilities and an extended product range.

The investments and performance enhancement measures of recent years have already helped significantly strengthen ThyssenKrupp Acciai Speciali Terni. “Divisions which were rated critical a few years ago have now demonstrated their performance capabilities. They were helped in this by successful integration into the global network of the Stainless group,” says the Executive Board Chairman of ThyssenKrupp Stainless, Jürgen Fechter. This successful approach will be continued in the future. Further investments are in prospect, offering the plant in Terni opportunities for further growth. “ThyssenKrupp Stainless has the greatest possible interest in the positive long-term performance of the group and therefore of ThyssenKrupp Acciai Speciali Terni,” stresses Fechter: “We want to make Terni a world-class stainless steel site.”

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