Lone Star Technologies to Acquire North Star Steel's Tubular Division

Lone Star Technologies, Inc. and North Star Steel Company, a wholly owned subsidiary of Cargill, Incorporated, announced that their boards of directors have approved a definitive agreement under which Lone Star will acquire the assets of North Star's Tubular Steel Division. The Tubular Division is a leading producer of seamless products,including line pipe, standard pipe, mechanical pipe, coupling stock and casing that are used primarily in the oil and gas exploration and transmission industry. The Tubular Division has facilities in Youngstown, Ohio and Houston, Texas.

Lone Star will pay $430 million to complete the acquisition and will assume certain working capital liabilities. Approximately $130 million of the purchase price will be provided by the private placement of Lone Star common stock, of which up to $50 million can be sold to Cargill. The transaction is expected to be accretive to Lone Star's earnings per share and is expected to be completed in the fourth quarter of this year.

The Tubular Division's revenues, EBITDA and net income for the fiscal year ended May 31, 2001 were $328.6 million, $76.9 million, and $45.3 million, respectively. The Tubular Division had $157.4 million of total assets as of May 31, 2001.