Altos Hornos De Mexico, S.A. De C.V. Announces the Sale of Assets to Reduce Debt Levels.

MONCLOVA, Coahuila, Mexico--(BUSINESS WIRE)--Dec. 16, 1998--Altos Hornos de Mexico, S. A. de C.V. ("AHMSA" or the "Company") (NYSE: IAM), announced its plan to initiate the sale of assets. Among them are four oxygen plants and two coke plants, which represent a combined estimated value of US $300 million. Revenues generated from the sale will be used towards the payment of debt.

With the proceeds of such sales, AHMSA will principally reduce short-term, high-interest rate debt. The acquisition of debt at a discounted rate will provide the Company with significant debt reductions overall.

The facilities for sale are modernized, efficient and highly profitable and represent an attractive offer for potential investors specialized in such operations. International companies have already expressed an interest in the oxygen plants, as well as the coke plants. Firm purchase offers should be received in the first quarter of 1999.

The sale of the coke plants will not impact the Company's operations since it maintains control of all its raw material inputs and continues to have one of the highest operating margins of all steel companies in accordance with its costs and sales prices.

The Company continues with its implementation of the AHMSA XXI Plan and expects to generate between US $320 - $330 million in cash flow from its operations at the close of 1998.

AHMSA reduced its fixed and variable costs approximately 15%, and achieved 7% more production and 5% yield in its production processes. This has permitted the Company to confront the fall of international steel prices.

AHMSA maintains a solid position in the domestic and international markets with approximately 45% of its sales dollar-denominated.

Located in Monclova, in the state of Coahuila, AHMSA is the largest steel producer in Mexico. The Company, an integrated steel producer, manufactures a variety of flat steel products. It also produces higher value-added coated products such as galvanized and pre-painted steel, as well as a number of long products. The Company also owns and operates its own iron and metallurgical coal mines, which produce raw materials used in the steelmaking process. Through its subsidiary MICARE, the company is also engaged in the production and sale of steam coal for power generation. Visit AHMSA's website at www.ahmsa.com.