The offering price of the bonds was fixed at 100% of the par value. The rate for the first coupon ranged from 7.95 to 8.65%. Five million bonds were placed, while the demand was RUR 5.44 billion.

The funds from the bond placement will be allocated to refinance the debt under previous bond issues of Mechel OAO and Mechel Trading House OOO.

The circulation period is seven years. The bond will have fourteen coupon payments. The first coupon rate is determined at a tender held by the Moscow Interbank Currency Exchange (MICEX), the coupon rates from two to eight will be equal to the first coupon rate, while the remaining coupon rates will be determined by the issuer. The bond will have an offer for early redemption of bonds after four years from the placement. The 02 Series issue is registered by the Federal Committee for the Securities Market on May 25, 2006, registration # 4-02-55005-E.

Mechel Trading House OOO acts as the guarantor under the bond loan.

JS Bank "Gazprombank" (CJSC) is appointed to be the manager of the issue.

"We are pleased with the results of the new bond placement, and are glad that the market continues to positively evaluate the performance of our company. Mechel's management appreciates the confidence that investors once again put in the company. This issue allows Mechel to improve its financial position and continue the implementation of the strategic investment program targeted at strengthening of the mining business and raising the efficiency of the steel segment," said Alexey Ivanushkin, Chief Operating Officer of Mechel OAO.