Gerdau Ameristeel Corp. announced that its registration statement has become effective under the U.S. Securities Act of 1933 and that it has obtained a receipt for a final prospectus from Canadian securities regulatory authorities in connection with its offering of 70 million common shares.

Of the 70 million shares, parent company Gerdau SA will purchase 35 million common shares and 35 million common shares will be distributed to the public through an underwriting syndicate.

The common shares are being sold in the United States and Canada at a price of $4.70, or Cdn. $5.90, per share. Total gross proceeds will be approximately $329 million, or Cdn. $413 million. If the underwriters exercise their overallotment option in full (for 5.25 million common shares) and Gerdau SA, as it has agreed, purchases an equivalent number of additional common shares, total gross proceeds will be approximately $378 million, or Cdn. $475 million.

Proceeds of this offering will be used to finance Gerdau Ameristeel's previously announced proposed acquisition of North Star Steel assets and working capital — four long steel product mills and four downstream facilities — from Cargill, Inc. The company will also utilize the proceeds to fund capital expenditures and working capital and for general corporate purposes.

Merrill Lynch, Pierce, Fenner & Smith Inc. and BMO Nesbitt Burns Inc. are acting as joint book-running managers for the public offering in the United States and Canada. CIBC World Markets Corp., J.P. Morgan Securities Inc. and Morgan Stanley & Co. Incorporated are acting as underwriters.

The common shares commenced trading on the New York Stock Exchange on Friday, Oct., 15 under the symbol GNA. The offering is expected to close on or about October 20, 2004.

Additional information on the offering or a copy of the prospectus may be obtained by contacting Merrill Lynch at World Financial Center in New York or in Toronto, or by contacting BMO Nesbitt Burns in Toronto.

The company cautions that this announcement does not constitute an offer to sell or the solicitation of an offer to buy, and that there shall be no sale of these securities in any province, state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any province, state or other jurisdiction.

Gerdau Ameristeel is the second-largest minimill steel producer in North America with annual manufacturing capacity of over 6.4 million tons of mill finished steel products. Through its vertically integrated network of 11 minimills (including one 50%-owned minimill), 13 scrap recycling facilities and 32 downstream operations, Gerdau Ameristeel primarily serves customers in the eastern half of North America.