1. Klöckner & Co AG
1st Klöckner & Co
Analysts' and Investors' Meeting
Switzerland, September 19, 2007
Dr. Thomas Ludwig, CEO
Gisbert Rühl, CFO

2. 2
Agenda
1. Multi metal distribution – value chain and customer
requirements
Dr. Thomas Ludwig
2. Acquisition process
Gisbert Rühl

3. 3
Overview multi metal distribution
Important mediator between producer and customer
Bundling of needs, purchasing in bulk
Via processing / sale of customer specific products
Operating in local markets close to the customers
Competition primarily via service, availability of products and short lead times
Servicing small and medium-sized enterprises of all industries
Steady demand over the price cycle
Ability to pass on price changes of the market to customers
Not affected by more cyclical end-user businesses, e.g. automotive

4. 4
Function of a multi metal distributor in the value added chain
Requirements of the
end- users:
Offering of the multi metal
distributor
Requirements of the
multi metal producers:
 High sales and access
to new customers
 Adequate lead time
 Increased capacity
utilization
 Long term customer
relationships
 Simplified logistics
 “One-stop-shop”
 Availability of a broad
range of multi metal
products
 Services generating
higher value added
 Reduced purchasing
and stocking costs
 Warehouses nearby
 Quality assurance
 Purchasing in bulk from
producers
 Handling of small customer
orders
 Further processing of the
material according to
customer requirements
 Stocking to ensure shorter
lead times
 Continuous purchase

5. 5
Products and services
Products
Long products
Sectional
steel/Tubes
Stainless and
aluminum
Flat steel
Services
Blanking/Flame &
Plasma cutting
Cut and slit from coil
Cut to length/
Mitre cut/Bending
Shot blasting/
Priming/Conservation

6. 6
Steel distribution and market supply
About two thirds of market supply in Western Europe
through steel distribution and service centers
40 to 80% of the steel consumption (depending on the individual
market) served through distribution and service centers
Steel distribution is partly linked to mills through same shareholder
structure

7. 7
Steel distribution and market supply
Share of steel distributionTotal market supply
Direct delivery
through
producers
Steel
distribution
Flat SSC
Independent small
and medium sized
distributors
Source: www.metalbulletin.com
30%
20%
Mill-tied
distribution
Independent
big
distributors
50%
27%
33%
40%

8. 8
Requirements of the customers
Market oriented price policy
Access to global sourcing through distribution
Availability of broad range of multi metal products
Manifold processing available
On-time delivery within 24 hours guaranteed
Increased outsourcing of processing
Smaller and more complex order sizes
Tailor-made logistics
Full service offering
Quality control

9. 9
Customer decides!
Processes are getting more complex
The most convenient solution for the customer will be the most successful
Distributor has to ease complex structures for the customers:
Customer

10. 10
Broad range
of products
Stockholding
(Full range of
products)
Processing/
Services
Distribution/
Information/
Logistics
One Stop Shopping
A comprehensive service chain = One Stop Shopping
Tailor-made logistics for the customer including
on-time delivery (24 hour delivery) and high quality
+++

11. 11
Need to grow
Consequences for the distribution:
Know-how,
competences and
services required
to service
producer and
customer at the
same time
Expand
geographic reach,
as distribution has
to be close to the
customers also to
ensure supplier’s
market coverage
Services linked
with logistics
require critical
mass in order to
make the system
profitable
The system
requires volume –
to realize
“Economics of
Scale”
Preconditions to achieve cost and price leadership

12. 12
How will the supplier-distributor relationship develop
in the future?
Increasing consolidation of the steel producers
Risk of market dominating positions for steel producers in
individual markets
Increasing need of size in the steel distribution sector to
prove benefit for the steel producers
Global sourcing is compulsory for the steel distribution
Global sourcing results in new challenges for an optimized
supply chain and capital as well as price risk management
Further consolidation of the steel distribution is required

13. 13
No shift of the market allocation between producers and steel
distribution in Europe
Producers will further invest in globalization
Backward integration – access to raw material – is of high strategic
importance for the producers
Steel distribution is – like in other industries - not the logical part of the
value chain of steel production
Service centers for key accounts remain business segment of the
producers
Integrated strategic concepts of production and distribution will lose
importance as a result of increasing product specialization (e.g. quality
steel flat only) and globalization

14. 14
Full line
product portfolio
for material group
(e.g. stainless)
Competition of distribution concepts: who will be the winner?
Specialized
distributor in
single product
categories
(e.g. heavy plate)
Multi metal
distribution
(steel, stainless,
non-ferrous metal)

15. 15
Our answer: multi metal distribution
Buy global
Sell local
As a full product range supplier
For a broad range of metal consumers
Requires a network of branches
Thus decentral organization
With strong central functions – sourcing, IT, finance, etc.

16. 16
Klöckner & Co at a glance
CustomerDistributor
Products:
Services:
Producer
Construction
 Structual
Steelwork
 Building and cvil
engineering
Machinery/
Mechanical
Engineering
 Automotive
 Metal products/
goods, installation
 Durable goods
 etc.
Klöckner & Co
 Leading producer-independent steel and
metal distributor in the European and North
American markets combined
 Distribution network with approx. 250
warehouses in Europe and North America
 Key financials FY 2006
- Sales volume: 6.0 million tons
- Sales: €5.532 million
- EBITDA: €395 million

17. 17
Distributor in the sweet spot
Local customersGlobal suppliers
Suppliers Sourcing
Products
and services
Logistics/
Distribution
Customers
 Global Sourcing
in competitive
sizes
 Strategic
partnerships
 Frame contracts
 Leverage one
supplier against
the other
 No speculative
trading
 One-stop-shop
with wide product
range of high-
quality products
 Value added
processing
services
 Quality assurance
 Efficient inventory
management
 Local presence
 Tailor-made
logistics including
on-time delivery
within 24 hours
 > 200,000
customers
 No customer
accounts for more
than 1% of sales
 Average order
size of €2,000
 Wide range of
industries and
markets
 Service more
important than
price
 Purchase volume
p.a. of 6 million
tons
 Diversified set of
worldwide approx.
70 suppliers
 Examples:
Klöckner & Co’s value chain

18. 18
CDN
B D
F
E
CH
A
CZ
PL
LT
RO
NL CN
USA
GB
IRL
Global reach with broad product and customer diversification
About 250 locations
28 LocationsUSA
5 LocationsCDN
48 LocationsE
30 LocationsCH
76 LocationsF
25 LocationsD
11 LocationsEastern Europe
7 LocationsNL
1 LocationIRL
24 LocationsGB
BU

19. 19
Global reach with broad product and customer diversification
Customer diversification (2006)
Other
GB
Construction
Machinery/
Manufacturing
Auto-
motive
40%
20%
5%
35%
23%
21%
15%
10%
9%
6%
1%
10%
Germany/
Austria
France/
BelgiumSpain
Nether-
lands
Eastern
Europe
USA
(incl. Primary
17%)
Switzerland
Canada
5%
Steel-flat
Products
Steel-long
Products
Tubes
Special
and
Quality
Steel
Aluminum
Other Products
28%
31%
9%
10%
8%
14%
Sales split by industry Sales split by markets Sales split by product

20. 20
Agenda
1. Multi metal distribution – value chain and customer
requirements
Dr. Thomas Ludwig
2. Acquisition process
Gisbert Rühl

21. 21
Profitable growth
Grow more than
the market
Continuous
business
optimization
1 Acquisitions driving
market consolidation
Organic growth and
expansion into new
markets
2
3 STAR Program:
- Purchasing
- Distribution network
Profitable growth
through value-added
distribution and services
within multi metals to
companies in Europe
and North America
Profitable growth
through value-added
distribution and services
within multi metals to
companies in Europe
and North America

22. 22
€36 millionMetalsnabAug 2007
€108 million4 acquisitions2006
€537 million9 acquisitions2007 ytd.
€35 millionTournierJan 2007
€14 millionTeulingApril 2007
€360 millionPrimary SteelApril 2007
€17 millionEdelstahlserviceApril 2007
€15 millionMax CarlApril 2007
€11 millionZweygartApril 2007
€23 millionPremier SteelMay 2007
€26 millionWestokJune 2007
€141 million
Sales
2005
Acquired CompanyCountry
2 acquisitions
Accelerating numbers of acquisitions
Acquisitions
9
4
2
2005 2006 2007
Number Sales
€141 million
€108 million
€537 million

23. 23
North America (2006)
Companies: ~1,300 only independent distributors
Europe (2006)
Companies: ~3,000 few mill-tied, most independent
Huge opportunities in fragmented markets
Source: Purchasing Magazine (May 2007)Source: EuroMetal, company reports, own estimates
ArcelorMittal AM3S Division
(Distribution approx. 5.5%)
ThyssenKrupp
Corus
Other
independents
Other
mill-tied
distributors
Klöckner & Co
Olympic Steel
Namasco
(Klöckner & Co)
Ryerson
Other
Reliance Steel
Samuel, Son & Co
ThyssenKrupp Materials NA
Russel Metals
Worthington
Steel
Metals
USA
Carpenter
Technology
PNA Group
McJunkin
O'Neal Steel
Mac-
Steel
AM Castle72.5%
Namasco
with Primary
approx. 1.4%
11%
8%
7%
4%~ 45-
55%
~ 15-
25%
4.5%
2.5%
2.1%
1.8%
0.9%
0.9%
0.8%
1.4%
1.3%
1.2%
1.3%
1.8%
1.4%
1.0%
4.7%

24. 24
Strong acquisition criteria
Further acquisitions in core markets and Eastern Europe:
• Leverage existing structure in core markets with small- and
mid-size bolt-on acquisitions
• Large scale acquisitions when appropriate
• Acquisitions in Eastern Europe to increase footprint
Focus on targets in 3 directions:
• Expansion of geographic reach
• Extension of customer base
• Extension of product portfolio
Focus on targets at attractive valuations:
• EV/EBITDA multiple between 4x and 5x for smaller
acquisitions
• EV/EBITDA multiple between 5x and 6x for mid-size and large
scale acquisitions
Focus on targets with significant synergy and scale effects:
• Stronger purchasing power
• Streamlining operations and processes, integrating IT
• Integration of STAR
Accretive growth

25. 25
Efficient acquisition process
Approach
• Existing local contacts to competitors
• Pro-active contact via M&A advisors
• External contacts (seller, M&A advisors, banks, etc.)
Selection of acquisition targets
• Targets must fulfil acquisition criteria
Handling of acquisition projects
• Depending on size and complexity of the deal and
experience of the country management the process is
either run locally or lead by the headquarters
• Duration of the projects between 3 to 6 months (first
contact to completion)
• Due diligence is focussed on the areas of finance, sales/
marketing, logistics/distribution/stocks, personnel and
legal/environmental
Country
Organization
Group
Joint effort
Size of the project
Complexityoftheproject
Process run by…

26. 26
Namasco Gen. line
Namasco Processing
Example: Primary Steel
Geographical Scope Facts (2006)
Sales: $467m (€360m)
Employees: 412
Customers: 2,500
Sales split: Plate (89%)
Light flat rolled (8%)
Pipe (3%)
Segments: Heavy Equipment (29%)
Oil & Gas (16%)
Power Generation (6%)
Ship Building (5%)
Transp. Equipm. (5%)
Metal builders (3%)
Construction (3%)
Service Centers (33%)
One of the leading suppliers
of heavy plates in the US with
an excellent reputation
Primary outlet
Primary Sales office
Oakland
Houston
Missouri
Chicago
Tampa
Charlotte
Arizona
Arkansas
Iowa
Alabama Georgia
South
Carolina
North Carolina
Indiana
Maryland
Maine
Connecticut
Florida
Louisiana
Illinois
Texas
California
Dubuque
Louisville
Indianapolis
Atlanta
B´ham
Charleston
Dallas
Austin
New Orleans
Jacksonville
Orlando
Pompano
Santa Fee Springs
Phoenix
Santa Fee Springs
Tulare
West Memphis
Savannah
Portland
Middletown
New Castle

27. 27
Selection and processing
Contacts
Selection
Processing
 Klöckner & Co was approached by investment bank acting for the seller
 Limited auction process
 Local team with close co-operation with headquarters
 Duration approx. 5 months including negotiations
 Intensive due diligence including all areas
 Further strengthening of market position in the area of heavy plates
 Expansion of geographic reach
 Access to new customer groups
 Improved basis for further acquisitions
 Significant synergy potential
 Reasonable valuation

28. 28
Integration will be fully completed until Q1 2008
Title May Jun Jul Aug Sep Oct Nov Dec Jan
Transfer of ownership 11.05.
Integration of central functions:
11.05. Cash Management
01.07. Reporting finance
01.07. Creditors
01.01.
 Accounting
 Personnel
30.09. Debtors
01.06. Health & safety
24.06. 20.08.
Integration of sites (> 400 employees):
 West Memphis
Co-ordination
Q1 2008
Centralization/Integration
 Purchasing (locally)
01.08. Financing (ABS)
Q1 2008
 Remaining locations
29.07. 20.10. Oakland
05.08. 14.11. Santa Fe Springs

29. 29
Oakland
Houston
Missouri
Chicago
Tampa
Charlotte
Arizona
Arkansas
Iowa
Alabama
Georgia
South
Carolina
North Carolina
Indiana
Maryland
Maine
Connecticut
Florida
Louisiana
Illinois
Texas
California
Dubuque
Louisville
Indianapolis
Atlanta
B´ham
Charleston
Dallas
Austin
New Orleans
Jacksonville
Orlando
Pompano
Phoenix
Santa Fe Springs
Tulare
West Memphis
Savannah
Portland
Middletown
New Castle
Integration of the location Santa Fe Springs (1)
Primary outlet
Primary Sales office
Namasco Gen. line
Namasco Processing
• New geographic
dimension
• 86 employees
• €73 million sales
• 89 Kto sales volume

30. 30
Integration of the location Santa Fe Springs (2)
Organization ProcessTeam
Site Manager (1.0)
Assistants (2.0)
Purchasing (2.0)
Sales (1.0 + 12.0)
Warehouse (1.0 + 32.0)
Processing (2.0)
Logistics (2.5)
Debtors (1.0)
Creditors (0.5)
Quality management (0.5)
Accounting (1.0)
IT (1.0)
Personnel (1.0)
Total: (86.0)
Minimal complexity
Total integration completed
within 12 weeks
• IT network, data
and IT system 8 weeks
• Training new
software 8 weeks
• Intensive
support 2 weeks
Fast process
2 Project managers
(Namasco)
18 Team members
(Namasco
+Primary)
2 Data transfer
(Namasco)
3 Network/
IT-support (Namasco)
Experienced team

31. 31
Significant synergy and scale effects
Integration
Primary Steel will be managed as additional
locations with partial back office integration
• Finance functions and purchasing will be fully
integrated into Namasco’s headquarters in
Atlanta
• Stock management will report to headquarters
• Billing and Credit Management will remain local
but report into same function in headquarters
• Sales remains under local management
• Namasco’s flat rolled SE division will be
reporting into a new sales division “Primary “
• Primary’s brand name be maintained for the
nearer future
Implementation would take until Q1 2008 with
systems’ integration as main challenge
• Estimate 6-8 weeks per location required
• Approximately 50 weeks to fully integrate into
Namasco’s systems
Synergies (in $000’s)
Area
Additional rebates from including
Primary into Namasco’s rebate
schemes and vice versa
Reduction of management and
admin headcounts
Sale of Namasco’s products
through Primary’s warehouses
Increasing value added services
IT Integration cost
Total
2,500
1,000
2,000
1,500
7,000
Additional
EBITDA
p.a.
One-time
expenses
500
500
750
1,750
Expected margin improvement of 1.5%

32. 32
Strong acquisition criteria fulfilled
Further acquisitions in core markets and Eastern Europe:
• Leverage existing structure in core markets with small- and
mid-size bolt-on acquisitions ✔
• Large scale acquisitions when appropriate ✔
• Acquisitions in Eastern Europe to increase footprint
Focus on targets in 3 directions:
• Expansion of geographic reach ✔
• Extension of customer base ✔
• Extension of product portfolio
Focus on targets at attractive valuations:
• EV/EBITDA multiple between 4x and 5x for smaller
acquisitions
• EV/EBITDA multiple between 5x and 6x for mid-size and large
scale acquisitions ✔
Focus on targets with significant synergy and scale effects:
• Stronger purchasing power ✔
• Streamlining operations and processes, integrating IT ✔
• Integration of STAR ✔
Accretive growth ✔

33. 33
Clear target
Finally the target of driving consolidation is clear
Increase volume and scale
to improve purchasing conditions
to improve logistics and stockholding
to improve coverage of fix costs
to improve local market share

34. 34
Our symbol
the ears
attentive to customer needs
the eyes
looking forward to new developments
the nose
sniffing out opportunities
to improve performance
the ball
symbolic of our role to fetch
and carry for our customers
the legs
always moving fast to keep up with
the demands of the customers

35. 35
Disclaimer
This presentation contains forward-looking statements. These statements use words like "believes,
"assumes," "expects" or similar formulations. Various known and unknown risks, uncertainties and
other factors could lead to material differences between the actual future results, financial situation,
development or performance of our company and those either expressed or implied by these
statements. These factors include, among other things:
 Downturns in the business cycle of the industries in which we compete;
 Increases in the prices of our raw materials, especially if we are unable to pass these costs
along to customers;
 Fluctuation in international currency exchange rates as well as changes in the general
economic climate
and other factors identified in this presentation.
In view of these uncertainties, we caution you not to place undue reliance on these forward-looking
statements. We assume no liability whatsoever to update these forward-looking statements or to
conform them to future events or developments.