Stelco Inc. has entered into a definitive agreement for the sale of AltaSteel Ltd.’s assets of to Scaw Metals Group, one of Africa's largest diversified iron, steel and engineering works.

The transaction is subject to a number of conditions, including obtaining court approval as well as the required regulatory and lenders' consent. It is anticipated that the sale will close early in 2006, provided that all conditions are satisfied as planned.

Scaw has indicated its intention to continue operating AltaSteel in its current lines of business and in its current location near Edmonton, Alta. Scaw has also indicated that it looks forward to building upon the strong business platform that AltaSteel has established, while making focused capital investments to provide for increasing demand in the growing Alberta economy.

Courtney Pratt, Stelco President and CEO, said, "This marks an important step in our pursuit of a transaction that will be good for AltaSteel, for its employees and retirees, and for Stelco. A successfully completed transaction will provide AltaSteel with ownership that views it as a strategic asset. It will provide employees and retirees with greater certainty. And it will assist Stelco in focusing on its integrated steel business."

Stelco notes that pursuit of the sale of AltaSteel, as in the case of the company's other non-core subsidiaries, reflects Stelco's previously announced decision to focus on its integrated steel business going forward.

Stelco Inc. is a large, diversified steel producer involved in major segments of the steel industry through its integrated steel business, minimills, and manufactured products businesses.