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                                                                    EXHIBIT 99.1


                       NORTHWESTERN STEEL AND WIRE COMPANY
                 REACHES AGREEMENT IN PRINCIPLE WITH NOTEHOLDERS


         Sterling, Illinois -- September 28, 1999 --- Northwestern Steel and
Wire Company (Nasdaq:NWSW) announced that as part of its strategic plan to build
a new structural rolling mill in Sterling, Illinois, it has reached an agreement
in principle with the steering committee of its 9 1/2% Senior Notes to
restructure the $115 million of outstanding debt represented by the notes. The
terms include:

         -    a payment of $50 million plus accrued and unpaid interest to the
              Noteholders out of the company's funds and from the proceeds of a
              new revolving credit agreement expected to become effective in the
              near future;

         -    the issuance to the Noteholders of common stock representing 70%
              of the outstanding common shares of the company on a fully diluted
              basis; and

         -    the Noteholders will be given the right to elect 4 of 7 directors.

The agreement in principle has been approved by the Board of Directors of
Northwestern Steel and the steering committee will recommend its adoption by the
Noteholders.

         The company will also file an application under the Emergency Steel
Loan Guarantee Act of 1999 to obtain a guarantee of new senior debt to fund the
construction of the new mill.

         The agreement in principle with the Noteholders is subject to, among
other things (i) 95% acceptance by the Noteholders; (ii) obtaining the federal
guarantee of new senior debt; and (iii) stockholder approval.

         Fred Rocchio, Chief Executive Officer of Northwestern Steel and Wire,
stated: "In concluding this agreement with the Noteholders, Northwestern Steel
has achieved another critical component of our strategic plan to build a new
structural rolling mill. We have already reached agreement with the United
Steelworkers of America for a new labor agreement and we have substantially
completed the plans and feasibility studies for the new mill. Now, we need only
secure the federal guarantee under the Emergency Loan Act for all of the
components of our strategic plan to be in place. We are working closely with our
bankers to file a guarantee application as soon as the regulations governing the
guarantees are adopted, which is expected on or about October 18."






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         Except for historical information, matters discussed above contain
forward-looking information and describe the company's belief concerning future
business and capital market conditions and outlook based on currently available
information. The company has identified these "forward-looking" statements by
words such as "should result" and "to file" and similar expressions. Risks and
uncertainties which could cause actual results or performance to differ
materially from those expressed in these statements include the following:
volumes of production and product shipments; changes in product mix and pricing;
costs of scrap steel and other raw material inputs; changes in domestic
manufacturing capacity; the level of non-residential construction; final
approval of the agreement in principle with 95% of the Noteholders and
stockholder approval; whether the company can obtain a federal guarantee of debt
in an acceptable amount with acceptable terms; overall economic growth in the
United States; changes in legislative or regulatory requirements; and the level
of imported products in the company's markets. The company assumes no obligation
to update the information contained herein.

         Founded in 1879, the company is a major mini-mill producer of
structural steel components that include wide flange beams, channels, angles and
merchant bars, as well as rod and selected wire products. The structural
products are used in a wide variety of commercial, industrial and residential
construction applications.