Outokumpu Oyj - Company Announcement

Outokumpu to make further EUR 240 million investment into stainless steel value-added special products and service centers

Stock Exchange Release
October 23, 2007 at 1.00 p.m.

In line with Outokumpu's new strategy phase, announced on September
2007, to increase the share of direct end-user and project sales and
to expand the value-added special products capacity, new investments
worth a total of some EUR 240 million over the next five years have
been decided. The investments comprise the expansion of the hot
rolled plate (quarto plate) capacity in Sweden and the US, and
expanding the service center offering in Germany.

Consolidating leading market position in hot rolled stainless steel
plate

Outokumpu is the market leader in stainless steel quarto plate
(individually rolled wide and thick plate) with a global market share
of some 20%. The current production capacity of some 160 000 tons of
mainly tailor made plate in special grades has been fully loaded the
past few years. The growth of the overall quarto plate demand is
estimated to be strong in the coming years driven by high investments
into e.g. the energy sector, desalination and process industries in
general. The share of the high-strength low-nickel duplex grades is
estimated to grow faster than the overall market. To meet our
customers future demand and the general growth in this highly
attractive product range Outokumpu has decided to expand its
production capacity and capability in Degerfors in Sweden and New
Castle (IN) in the US by some 100 000 tons.

Current equipment will be upgraded and new equipment installed to
increase the capacities in Degerfors by some 80 000 tons to 190 000
tons and in New Castle by some 20 000 tons to 70 000 tons. The amount
of investments will be some EUR 180 million and EUR 40 million,
respectively. The investment will spread out to five years with the
majority of cash out-flows in 2008 and 2009. The returns on the
investments are well above the Group target of 13%. The new installed
capacity is for the most part scheduled to be available in 2010.

Outokumpu's quarto plate product mix will shift more and more to
value-added tailor made plates and special grades, especially
Outokumpu's proprietary lean duplex and other duplex grades. The
corrosion resistant high strength duplex grades offer considerable
material weight savings to customers and attractive opportunities to
Outokumpu. Typical end-user and project customers are in segments
like desalination, chemical tankers, oil & gas, pulp & paper, as well
as in energy, chemical and petrochemical industry. Applications
include e.g. pressure vessels and open tanks, heavy-walled pipes,
bridge sections and process equipment.

Expanding service center offering in Germany

To improve and increase its service offering to end-user and project
customers in Germany, the largest European stainless steel market,
Outokumpu will expand the stock and processing capacity of its
Willich service center in north-western Germany. With an investment
of some EUR 20 million the annual stock and processing capacity in
Willich will increase from the current 60 000 tons to some 110 000
tons by 2009. The investment comprises e.g. a new cut-to-length line
and a new slitting line.

For further information, please contact:

Päivi Lindqvist, SVP - IR and Communications, Outokumpu Oyj,
tel. +358 9 421 2432, mobile +358 40 708 5351
paivi.lindqvist@outokumpu.com

Eero Mustala, Senior Vice President - Corporate Communications,
Outokumpu Oyj,
tel. +358 9 421 2435, mobile: +358 40 504 5146
eero.mustala@outokumpu.com

OUTOKUMPU OYJ
Corporate Management
Ingela Ulfves
Vice President - Investor Relations
tel. + 358 9 421 2438, mobile +358 40 515 1531, fax +358 9 421 2125
e-mail: ingela.ulfves@outokumpu.com
www.outokumpu.com

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