Events of Significance

On September 29, 2009, Salzgitter Finance B.V., a wholly-owned Dutch subsidiary of Salzgitter AG, placed a convertible bond with a volume of € 296.45 million under a guarantee furnished by Salzgitter AG. Settlement took place on October 6, 2009. The term of the bond is seven years and may be returned by the investors after five years. The bond may be converted into the shares of Salzgitter AG and features an annually payable coupon of 1.125 % p.a. With a reference price of € 66.797 per Salzgitter share, a 25 % premium would result in a conversion price of € 83.4963. The subscription rights of current shareholders of Salzgitter AG to the part convertible bond were excluded. The issue serves to diversify the Salzgitter Group’s sources of funding, and the proceeds are destined for general corporate purposes.

The Supervisory Board of Salzgitter AG has decided to sell the nearly 900 apartments located in Peine to Wohnbau Salzgitter GmbH (Wohnbau). In return, Salzgitter AG will take over a 25.05 % stake in Wohnbau. Both transactions are to be completed by December 1, 2009. The combining of residential real estate activities is intended to foster a good relationship between the municipality of Salzgitter and our company in addition to commercial aspects. Salzgitter AG continues to assume responsibility for the region through this measure, but will no longer be directly involved in the management of the apartments which is not part of its industrial core business.

KWAG’s Supervisory Board made the decision in its meeting in September to sell Klöckner Hänsel Processing GmbH (KHP) as of November 1, 2009. The company will leave Salzgitter’s group of consolidated companies on this date.