Boulder Steel Receives US$ 91 million in Equity Funding Commitments for Seamless Tube Project

  
    
  
  
    
      Boulder Steel Limited (ASX: BGD), today announced it has received 
      commitments from companies owned by Messrs Abdul Rahman Falaknaz and 
      Mohammad Yousuf Al Ali, Boulder Steel’s two 
      major shareholders, and a US-based private equity company, to 
      participate in a private placement of Boulder Steel shares that will 
      raise US$91 million for the Company.
    
    
      Dr. Peter Wallner, Boulder Steel Managing Director & CEO, commented: “The 
      firm commitments we received reflect the significant progress Boulder 
      Steel has made in the development of our Seamless Tube Project. Raising 
      the equity funds through this placement represents a major milestone in 
      the Company’s progress toward completing the 
      total financing package required to realize the Seamless Tube Project.”
    
    
      The project consists of a steel plant, a tube mill and finishing 
      facility in Ipswich, Queensland, as well as a finishing plant in 
      Sharjah, United Arab Emirates.
    
    
      Under the commitment letters and signed application forms received by 
      Boulder Steel:
    
    
      
        Falak Investments AG (“FIAG”), 
        a Swiss company owned 100% by Mr. Falaknaz, has agreed to subscribe 
        for 30 million shares @ US$ 0.80/share for a total value of US$ 24 
        million.
      
      
        Capital Trust Holding AG (“CTH”), 
        a Swiss company owned 100% by Mr. Al Ali, has agreed to subscribe for 
        40 million shares @ US$ 0.80/share for a total value of US$ 32 million.
      
      
        American Overseas Investment Holding (“AOIH”), 
        a US-based private equity company, has agreed to subscribe for 
        43,750,000 shares @ US$ 0.80/share for a total value of US$ 35 million.
      
    
    
      In recognition of their dedication and contributions during the early 
      development stage of the seamless tube project, Boulder Steel has agreed 
      to issue options to the owners of FIAG and CTH. This will allow them to 
      maintain their equity share in the company when other option holders 
      exercise their options
    
    
      Under this agreement, FIAG will receive 30 million options, exercisable 
      at A$ 0.20/option over a 3 year period. CTH will receive 40 million 
      options, exercisable at A$ 0.20/option over a 3 year period.
    
    
      The issue of the abovementioned shares and options is subject to the 
      approval of both Boulder shareholders and the Foreign Investment Review 
      Board, which the company will seek as soon as possible.
    
    
      Both the private placement and the soon to be expected debt financing 
      package have been arranged by Boulder’s 
      financial advisor, Prime Asset Finance Ltd (“PAF”), 
      as the result of the finance management agreement between Boulder and 
      PAF.
    
    
      This significant milestone has been achieved through the combined 
      efforts of the Company’s director and major 
      shareholder, Mr. Abdul Rahman Falaknaz and the Company’s 
      Managing Director & CEO, Dr. Peter Wallner.
    
    
      About Boulder Steel Limited
    
    
      Boulder, through its 100% owned subsidiary Asia Pacific Seamless Tubes 
      Limited (APST), is developing a state-of-the-art steel plant and 
      production facility for seamless steel tubes, the only one of its kind 
      in Australia. The primary markets for this Project will be Australia and 
      the Asia Pacific region. Production is expected to commence in early 
      2009, with 350,000 tons of steel to be produced annually after ramp-up.
    
    
      In addition, Boulder, in co-operation with local partners, plans to 
      build a state-of-the-art finishing plant for seamless tubes in the 
      United Arab Emirates.
    
    
      Currently, Boulder owns 50% of Euro Forming Services GmbH (“EFS”), 
      a producer of high quality components for the Automotive and Aerospace 
      industries based in Bitburg, Germany. Since its foundation in 2000, EFS 
      has experienced exceptional growth and is continuously expanding its 
      production facilities.