Birmingham Steel Announces Strategic Restructuring.

BIRMINGHAM, Ala.--(BUSINESS WIRE)--Aug. 18, 1999--

-- Company Will Focus on Its Profitable Core Mini-mill and Scrap

Operations and Seek to Divest Its SBQ Division -

-- Actions "Will Position the Company to Achieve Its Overriding

Objective of Building Shareholder Value," Says Chairman/CEO

Bob Garvey --

Birmingham Steel Corporation (NYSE: BIR) today announced a strategic restructuring in which the Company will focus on its strong and profitable core mini-mill and scrap operations, seek to divest its SBQ (Special Bar Quality) division, which became part of the Company when it acquired American Steel & Wire Co. (AS&W) in 1993, and seek to divest the Company's 50% interest in American Iron Reduction (AIR). Implementation of this restructuring, which was unanimously approved by the Company's Board of Directors after a strategic review process that began early this year, and which is subject to review with the Company's lenders, is expected to begin shortly. The Company is also exploring its options with regard to Pacific Coast Recycling (PCR), in which the Company has a 50% ownership interest.

Robert A. Garvey, Chairman and Chief Executive Officer of Birmingham Steel, said, "Birmingham Steel's core operations are sound, highly efficient and increasingly profitable, despite some of the worst steel industry conditions in many years. Unfortunately, continuing challenges in our SBQ business--including the Memphis melt shop and the Cleveland rolling mills--have required a tremendous and continuing commitment of management resources, have constrained our financial performance, and have masked the strength and success of our core rebar, merchant bar and scrap businesses. We expect the impact of the restructuring will be reflected in the Company's financial results for the fourth quarter ended June 30, 1999, which the Company expects to release shortly. By pursuing this strategic restructuring, which is fully supported by senior management, we will unlock the values we have created in our core businesses and position the Company to achieve its overriding objective of building shareholder value."

Birmingham Steel said it has retained Credit Suisse First Boston to advise the Company on matters related to the restructuring.

Birmingham Steel's core mini-mills, which together provide industrial customers a broad range of merchant and rebar products, include facilities in Kankakee, Illinois; Joliet, Illinois; Birmingham, Alabama; Jackson, Mississippi; Seattle, Washington; and Cartersville, Georgia. The Company also plans to retain its profitable scrap operations in Jackson, Mississippi and Vancouver, British Columbia, and the PESCO Inc. sales and distribution business in Ft. Lauderdale, Florida.

Birmingham Steel operates in the mini-mill sector of the steel industry and conducts operations at facilities located across the United States. The Company produces steel reinforcing bar, merchant products and SBQ bar, rod and wire. The common stock of Birmingham Steel Corporation is traded on the New York Stock Exchange under the symbol "BIR."

Notice: except for historical information, the matters described in this press release are forward-looking statements within the meaning of the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including economic conditions, market demand factors, equipment breakdowns or failures, as well as other risks described from time to time in the Corporation's periodic and special filings with Securities and Exchange Commission. Any forward-looking statements contained in this document speak only as of the date hereof, and the Corporation disclaims any intent or obligation to update such forward-looking statements.