China Precision Steel Closes $47.9 Million Financing

China Precision Steel Closes $47.9 Million Financing

November 07, 2007

    SHANGHAI, China, Nov. 7 /Xinhua-PRNewswire/ -- China
Precision Steel (Nasdaq: CPSL), a niche precision steel
processing company principally engaged in producing and
selling high precision cold-rolled steel products,
announced today that it has successfully completed the sale
to certain institutional investors of an aggregate of
7,100,000 shares of its common stock at a purchase price of
$6.75 per share and an aggregate of 1,420,000 warrants to
purchase its common stock, for gross proceeds of
$47,925,000.  Roth Capital Partners, LLC acted as the
placement agent for this registered direct transaction.  

    "The market opportunity for high value ultra-thin
precision steel remains strong.  With this additional
capital, we plan to expand our production capacity of high
carbon and specialty precision steel as we build our
dominant position in China and expand into international
markets," commented Dr. Wo Hing Li.  

    This press release does not constitute an offer to sell
or the solicitation of an offer to buy any security and
shall not constitute an offer, solicitation or sale of any
securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of
such jurisdiction. 

    Any offering of the Company's common stock and warrants
in the United States is being made only by means of a
written prospectus meeting the requirements of Section 10
of the U.S. Securities Act of 1933, as amended.

    About China Precision Steel 

    China Precision Steel is a niche precision steel
processing company principally engaged in the production
and sale of high precision cold-rolled steel products and
provides value added services such as heat treatment, and
cutting medium and high carbon hot-rolled steel strips.
China Precision Steel produces high precision ultra-thin
and high-strength (0.03 mm to 7.5 mm) cold-rolled steel
products primarily for automotive components, food
packaging materials, saw blades and textile needle
manufacturing companies in the People's Republic of China.
The Company's operations are primarily located in China,
with sales to Southeast Asia and Africa. For more
information please visit
http://www.chinaprecisionsteelinc.com . 

    Forward-Looking Statements

    This press release contains forward-looking statements
within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements are
statements that are not historical facts. Such
forward-looking statements are based upon the current
beliefs and expectations of the Company's management and
are subject to risks and uncertainties, which could cause
actual results to differ from the forward-looking
statements. The following factors, among others, could
cause actual results to differ from those set forth in the
forward-looking statements:  business conditions in China,
weather and natural disasters, changing interpretations of
generally accepted accounting principles; outcomes of
government reviews; inquiries and investigations and
related litigation; continued compliance with government
regulations; legislation or regulatory environments,
requirements or changes adversely affecting the businesses
in which the Company is engaged; cyclicality of steel
consumption including overcapacity and decline in steel
prices, limited availability of raw material and energy may
constrain operating levels and reduce profit margins,
environmental compliance and remediation could result in
increased cost of capital as well as other relevant risks
not included herein. The information set forth herein
should be read in light of such risks. The Company does not
assume any obligation to update the information contained in
this press release.

    For more information, please contact:

    CCG Elite
     Crocker Coulson, President / 
     Leslie Richardson, Financial Writer
     Tel:   [phone] 
     Email: [e-mail] /
[e-mail]

    China Precision Steel
     Leada Li, CFO
     Email: [e-mail]