DSD Negotiating for Change in Ownership Structure

Der Grüne Punkt (DSD) has reached a decision to enter into exclusive negotiations with Kohlberg Kravis Roberts & Co. Ltd. to change the structure of the company. DSD is a German-based company that is responsible for the operation of that country’s Green Dot program.

The Dual System fulfils the take-back and recycling obligations specified in Germany’s Packaging Ordinance of 1991 and the amended version of 1998 on behalf of industry and trade.

In order to obtain the right to print the Green Dot trademark on their packaging, licensees pay a fee based on the polluter-pays principle to the Dual System. The fee is governed by the number of packaging units put on to the market and the weight of the applied materials.

As the umbrella organization for the recycling of sales packaging marked with the Green Dot in accordance with the provisions of the Packaging Ordinance, the company neither owns nor operates any sorting or recycling plants. In contrast, the Dual System organizes the collection, sorting and recycling of packaging waste in Germany with the support of about 400 waste management partners.

The Federal Cartel Office expects DSD AG to change its existing shareholder structure and open itself to the capital market by the end of this year. DSD and KKR are in agreement that the long-term goal is an initial public offering or comparable positioning of DSD AG on the capital market..

On successful conclusion of the negotiations, a take-over bid will be made to the shareholders of DSD AG.

According to published press reports the discussions between the two companies is focused on the sale to KKR of shares representing slightly more than 75 percent of Duales Systems' total outstanding shares.

Details of the financial deal are expected later this month.

KKR is a New York City-based financial services company focused on mergers and acquisitions.