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July 25, 2008


SDI to acquire Recycle South

Steel Dynamics Inc announced that OmniSource Corporation, a wholly owned subsidiary of Steel Dynamics and Recycle South, LLC have executed a definitive agreement whereby OmniSource will acquire the remaining equity interests in Recycle South, one of the largest regional scrap metal recycling companies in the nation.

Pursuant to the agreement, which has been unanimously approved by the boards of directors of both companies, OmniSource, which already owns 25% of Recycle South, will acquire the remaining equity interests in a transaction valued at approximately USD 500 million. Current Recycle South equity owners will receive 3,938,000 shares of Steel Dynamics common stock, valued at approximately USD 138 million and USD 232 million in cash. The aggregate transaction value includes the assumption of certain liabilities, including net debt, which are expected to total approximately USD 135 million at closing. Completion of the transaction is subject only to regulatory approval, and is expected to close before the end of the second quarter of 2008.

Recycle South employs 600 people in 19 locations throughout North Carolina, South Carolina and Georgia. On an annualized basis using actual results from September of 2007 to March of 2008, the company generated revenues of approximately USD 670 million from the processing of 1.4 million tonnes of ferrous scrap and 150 million pounds of nonferrous scrap. The company will operate as a division of OmniSource Corporation and will be called OmniSource Southeast. As part of OmniSource all current management will remain in place and will continue to focus on ferrous and nonferrous scrap processing, brokerage, and the industrial scrap management needs of its customers.

Mr Keith Busse chairman & CEO of Steel Dynamics said that "This transaction significantly expands our recycled metals business platform created by the acquisition of OmniSource in October 2007. It demonstrates SDI's strategic commitment to the continued expansion of ferrous and non-ferrous recycling, which is an important element of our overall growth plan. The additional capacity of the Recycle South operations brings our company's total annual ferrous scrap processing capacity to approximately seven million tons."

Mr Danny Rifkin president of OmniSource added that "This transaction demonstrates the company's willingness to capitalize on growth opportunities within the scrap processing segment and expand our geographic footprint into a region where both industrial and obsolete scrap generation is increasing. Having been partners with the members of Recycle South for some time, we are confident that integration efforts will be accomplished in a timely and efficient manner, allowing us to pursue further growth in this and other regions."

Mr Marvin Siegel chairman & CEO of Recycle South said that "We look forward to the next stage of our involvement with OmniSource and are excited to join the Steel Dynamics team. Our existing working relationship will make for a natural transition allowing us to sustain our growth pattern and maintain the highest level of service to our customers. Our strength has always been based in the Southeast and we are now excited to provide regional leadership as part of a larger network of companies."