Denali Announces Belco Acquisition.

HOUSTON--(BUSINESS WIRE)--Dec. 22, 1998--Denali Incorporated (Nasdaq:DNLI) today announced the signing of a letter of intent to purchase the outstanding stock of the Belco Manufacturing Companies ("Belco"). Located in Belton, Texas, Belco is a manufacturer of engineered fiberglass-reinforced plastic ("FRP") tanks, vessels, and piping systems, and their products are primarily sold to the water/wastewater and oil and gas industries where corrosion-resistant products are needed. Belco's calendar year 1998 revenues are anticipated to be approximately $8.0 million, and the acquisition is expected to close in January 1999.

"Belco represents another strategic step for Denali," stated Edward de Boer, president and chief operating officer of Denali Incorporated. "Belco's expertise in manufacturing piping systems and aboveground FRP tanks allows Denali to be competitive in a wider array of markets. Furthermore, Plasti-Fab, our most recent acquisition, and Belco's strength in the water and wastewater industry provide us with a strong foundation for continued growth."

Denali Incorporated is a provider of products and services for handling critical fluids. The company is a manufacturer of fiberglass-composite, underground storage tanks; steel, aboveground storage tanks; and engineered, fiberglass-reinforced, plastic-composite products for corrosion-resistant applications. Denali Incorporated is headquartered in Houston, Texas, and markets its products nationally through its subsidiaries Containment Solutions Inc. (Houston), Ershigs Inc. (Bellingham, WA), Fibercast (Tulsa, OK), and SEFCO Inc. (Tulsa, OK).

For more information on Denali Incorporated, please contact Mel Carter (vice president of business development) at 713/627-0933. Or visit the Denali Incorporated Website at www.denaliincorporated.com.

NOTE: This news release contains certain forward-looking statements as such term is defined in the Private Securities Litigation Reform Act of 1995 and information relating to the company and its subsidiaries that are based on the beliefs of the company's management as well as assumptions made by and information currently available to the company management. When used in this report, the words, "anticipate," "believe," "estimate," "expect," and "intend" and words or phrases of similar import, as they relate to the company or its subsidiaries or company management, are intended to identify forward-looking statements. Such statements reflect the current risks, uncertainties and assumptions related to certain factors including, without limitations, competitive factors, general economic conditions, customer relations, relationships with vendors, the interest rate environment, governmental regulation and supervision, seasonality, distribution networks, product introductions and acceptance, technological change, changes in industry practices, one time events and other factors described herein. Based upon changing conditions, should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described herein as anticipated, believed, estimated, expected or intended.