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2016-07-21

VALLOUREC: VALLOUREC starts exclusive negotiations with the Ascometal Group for the sale of a majority holding in the Saint-Saulve steel mill

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Press release

Vallourec starts exclusive negotiations with the Ascometal Group for the sale
of a majority holding in the Saint-Saulve steel mill

Thursday, July 21 2016 - Boulogne-Billancourt

: Vallourec, global leader in premium tubular solutions, has started exclusive
negotiations with Ascometal, Europe's largest producer of special steels,
with a view to the sale of its majority holding in the Saint-Saulve steel
mill (Hauts-de-France region). Based on a reinforced industrial and business
plan, the Ascometal offer should retain the site's 320 highly skilled
employees.

Negotiations should be concluded with a final agreement being signed by the
end of 2016.

At this stage in proceedings, the two partners envisage creating a joint
venture with Vallourec holding a 40% stake and Ascometal having a 60%
holding, thus giving the latter exclusive control of operations. Furthermore,
the Hauts-de-France region has confirmed its support for the transaction
according to conditions which are still to be determined.

From an industrial viewpoint, the two shareholders will be supplied by the
Saint-Saulve modern and high technology steel mill, Vallourec for its
requirements in terms of special steels and Ascometal to supply its finishing
units located in Dunkirk and Fos-sur-Mer, in the North and South of France.

The global industrial projects would include a significant investment program
in order to both diversify production at the Saint-Saulve steel mill and meet
Ascometal's new requirements.
It means:

* In Saint-Saulve, the upgrade of the existing equipment in order to produce
steel bars with varying diameters which would pave the way to accessing new
markets, in particular in the automotive industry.
* In Dunkirk, new rolling capacity that would enable this plant to gain a
foothold in new automotive markets.
* In Fos-sur-Mer, new equipment that would enable the rod mill to use the
semi-finished products made with the Saint-Saulve continuous casting, in
addition to the semi-finished products from the Fos ingot casting, in order
to allow this plant to enter new bearings markets.

At the outset, the undertakings made by the two parties in terms of the
quantities of steel produced are as follows: 175,000 tons per year for
Ascometal, and 100,000 tons per year for Vallourec. These volumes would
secure the steel mill's long-term operations and competitiveness.

Management and employee representatives were informed today about this stage
of the process of the partial sale of the steel mill.

About Vallourec

Vallourec is a world leader in premium tubular solutions for the energy
markets and for demanding industrial applications such as oil&gas wells in
harsh environments, new generation power plants, challenging architectural
projects, and high-performance mechanical equipment. Vallourec's pioneering
spirit and cutting-edge R&D open new technological frontiers. Operating in
more than 20 countries, its 20,000 dedicated and passionate people work
hand-in-hand with their customers to offer more than just tubes: they deliver
innovative, safe, competitive and smart tubular solutions, to make every
project possible.

Listed on Euronext in Paris (ISIN code: FR0000120354, Ticker VK) and eligible
for the Deferred Settlement System (SRD), Vallourec is included in the
following indices: SBF 120 and Next 150.

In the United States, Vallourec has established a sponsored Level 1 American
Depositary Receipt (ADR) program (ISIN code: US92023R2094, Ticker: VLOWY).
Parity between ADR and a Vallourec ordinary share has been set at 5:1.

About Ascometal

ASCOMETAL is a European leader in Specialty Long steel products dedicated to
the Automotive, Bearings, Energy and Mechanical Engineering sectors with a
yearly turnover of € 500 million.
With 1550 employees, ASCOMETAL operates 5 industrial facilities located in
France : 3 steel making plants (Dunkerque, Hagondange, Fos-sur-Mer) and 2
finishing centers (Custines, Saint-Etienne). In addition, Ascometal has an
industrial Joint-Venture in China (MASCOMETAL Ltd) and commercial
subsidiaries in Germany, Italy, Spain, Poland and USA.
ASCOMETAL has the largest European R&D center (CREAS) located in Hagondange,
focusing on specialty long steel products, with 40 employees. Innovation,
know-how and quality benefiting customers are the trademark of ASCOMETAL
products.

Contacts

Vallourec

Press -
Laurence Pernot -laurence.pernot@vallourec.com- Tel: +33 6 82 59 06 02 ;
Heloise Rothenbuhler -Heloise.rothenbuhler@vallourec.com- Tel: +33 6 45 45 19
67

Investor Relations -
Etienne Bertrand -etienne.bertrand@vallourec.com- Tel :+33 1 49 09 35 58;
Christophe Le Mignan -christophe.le mignan@vallourec.com- Tel : +33 1 40 09
38 96

Ascométal -
Maxime Lazard - maxime.lazard@ascometal.com - Tel : +33 1.42.38.74.35

PDF version
http://hugin.info/143606/R/2029857/754907.pdf

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This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: VALLOUREC via Globenewswire

HUG#2029857

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