euro adhoc: Klöckner & Co AG / Capital measures / Klöckner & Co launches convertible bond offering

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Disclosure announcement transmitted by euro adhoc. The issuer is responsible
for the content of this announcement.
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18.07.2007

Duisburg, 18 July 2007 - The management board of Klöckner & Co AG
("Klöckner & Co") resolved today to issue senior unsecured
convertible bonds (the "Bonds"). The Bonds will be issued by Klöckner
& Co Finance International S.A. (the "Issuer"), a wholly-owned
Luxembourg subsidiary of Klöckner & Co, guaranteed by Klöckner & Co,
and will be convertible into existing or new shares of Klöckner & Co.
The Bonds will be offered only to institutional investors outside of
the US. The pre-emptive rights of shareholders of Klöckner & Co to
subscribe to the Bonds are excluded.

The Bonds will have a maturity of five years. The Bonds will be
issued at 100% of the principal amount on 27 July 2007 (the
"Settlement Date"). The conversion price will be set at a premium of
35% above the volume weighted average XETRA price of Klöckner & Co´s
shares during the period from today's management board resolution on
the issue of the Bonds and the ultimate allocation of the Bonds due
to take place later today. The coupon will be between 1.00% - 2.00%;
it will be determined during a bookbuilding process planned to take
place today. The Bonds cannot be called by the Issuer for the first
three years, and are callable thereafter if the stock exchange price
of Klöckner & Co´s shares exceeds 130% of the conversion price.

The base offering size will be EUR 300 million. The offering size may
be increased by up to EUR 25 million. In addition, the issuer has
granted the Joint Bookrunners, Deutsche Bank and JPMorgan, a
greenshoe option of up to EUR 25 million to cover over-allotments (if
any). The maximum issue size can therefore amount to EUR 350 million.

Klöckner & Co intends to list the Bonds in the Open Market
(Freiverkehr) segment of the Frankfurt Stock Exchange.

Deutsche Bank and JPMorgan are acting as Joint Bookrunners, Joint
Lead-Managers and sole syndicate members for the Offering.

Klöckner & Co intends to use the proceeds from the sale of the
convertible bonds for general corporate purposes and to continue its
stated external expansion.

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IMPORTANT NOTE

NOT FOR DISTRIBUTION OR RELEASE IN OR INTO THE UNITED STATES OF
AMERICA (OR TO US PERSONS), AUSTRALIA, CANADA OR JAPAN, OR IN ANY
OTHER JURISDICTION IN WHICH OFFERS OR SALES WOULD BE PROHIBITED BY
APPLICABLE LAW

This ad-hoc announcement is for information purposes only and does
not constitute or form part of, and should not be construed as an
offer or an invitation to sell, or issue or the solicitation of any
offer to buy or subscribe for, any securities. In connection with
this transaction there has not been, nor will there be, any public
offering of the Bonds. No prospectus will be prepared in connection
with the offering of the Bonds. The Bonds may not be offered to the
public in any jurisdiction in circumstances which would require the
Issuer of the Bonds to prepare or register any prospectus or offering
document relating to the Bonds in such jurisdiction. The
distribution of this ad-hoc announcement and the offer and sale of
the Bonds in certain jurisdictions may be restricted by law. Italy
has only partially implemented the Prospectus Directive and,
accordingly, the provisions of the Prospectus Directive shall apply
with respect to Italy only to the extent to which the relevant
provisions of the Prospectus Directive have already been implemented
in Italy. The Bonds may not be placed, sold or offered to individuals
resident in Italy in the primary or in the secondary market. Any
persons reading this ad-hoc announcement should inform themselves of
and observe any such restrictions.

In connection with the offering of the convertible bonds, Deutsche
Bank (the "Stabilising Manager") or any person acting on behalf of
the Stabilising Manager, may over-allot and effect transactions with
a view to supporting the market price of the Bonds at a level higher
than that which might otherwise prevail. However, there is no
assurance that the Stabilising Manager (or persons acting on behalf
of the Stabilising Manager) will undertake stabilisation action. Any
stabilisation action shall begin on or after the date on which
adequate public disclosure of the final terms of the offer of the
Bonds is made and, if begun, may be ended at any time, but it must
end no later than the earlier of 30 days after the Settlement Date
and 60 days after the allotment of the Bonds. Stabilisation FSA

This ad-hoc announcement does not constitute an offer to sell or a
solicitation of an offer to purchase any securities in the United
States. The securities referred to herein (including the Bonds and
the shares of Klöckner & Co) have not been and will not be registered
under the U.S. Securities Act of 1933, as amended (the "Securities
Act") or the laws of any state within the U.S., and may not be
offered or sold in the United States or to or for the account or
benefit of U.S. persons, except in a transaction not subject to, or
pursuant to an applicable exemption from, the registration
requirements of the Securities Act or any state securities laws. This
ad-hoc announcement and the information contained herein may not be
distributed or sent into the United States, or in any other
jurisdiction in which offers or sales of the securities described
herein would be prohibited by applicable laws and should not be
distributed to United States persons or publications with a general
circulation in the United States. No offering of the Bonds is being
made in the United States.

This ad-hoc announcement is only being distributed to and is only
directed at (i) persons who have professional experience in matters
relating to investments falling within Article 19(1) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005 (the
"Order") and (ii) high net worth entities falling within Article
49(2) of the Order and (iii) persons to whom it would otherwise be
lawful to distribute it (all such persons together being referred to
as "relevant persons"). The Bonds are only available to, and any
invitation, offer or agreement to subscribe, purchase or otherwise
acquire such Bonds will be engaged in only with, relevant persons.
Any person who is not a relevant person should not act or rely on
this ad-hoc announcement or any of its contents.

*****

Supplemental information:

Issuer: Klöckner & Co Aktiengesellschaft, Am Silberpalais 1, D 47057
Duisburg ISIN: DE000KC01000 WKN: KCO100 Listed: Amtlicher Markt /
Prime Standard; Frankfurter Wertpapierbörse

Further information can be obtained on the webpage of Klöckner & Co:
www.kloeckner.de

end of announcement euro adhoc 18.07.2007 07:25:54
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ots Originaltext: Klöckner & Co AG
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:
Claudia Uhlendorf
Tel.: +49 203 307 2289
claudia.uhlendorf@kloeckner.de

Branche: Metal Goods & Engineering
ISIN: DE000KC01000
WKN: KC0100
Index: CDAX, Classic All Share, Prime All Share, MDAX
Börsen: Börse Frankfurt / official dealing/prime standard
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