KKR & Co. L.P.

  • Investments of EUR 61.2 million have been agreed upon under the long-term partnership
  • The investment significantly strengthens Hertha's financial structure and allows for a comprehensive deleveraging; with a stake of almost 10%, the investor KKR becomes minority shareholder and partner of the club
  • The agreement has already been signed and approved unanimously by the relevant bodies

Berlin, 31 January 2014 - Hertha BSC GmbH & Co. KGaA has entered a strategic partnership with the leading global investor Kohlberg Kravis Roberts & Co. L.P. (together with its affiliates, "KKR"). The long-term investment of EUR 61.2 million under the agreement consists of several components. One of these is the acquisition of a 9.7% minority share in Hertha BSC.

The cooperation allows for a comprehensive deleveraging and the repurchase of rights. By this means, Hertha BSC sustainably improves its cost and earnings situation, as well as the balance sheet structure of the club. The supervisory board and the presidium of the club, as well as the supervisory board and the advisory board of the KGaA, had unanimously approved the agreement.

Michael Preetz, managing director of Hertha BSC, said: "The success of professional football clubs depends not only on their sporting but also on their economic performance. The partnership with KKR, one of the most renowned investors, represents a quantum leap for the economic situation of our club. Going forward, Hertha BSC will have more space for maneuver which we will make use of with a sense of proportion. We will remain fully committed to our strategy of focusing on our superior youth development and of integrating young, talented players."

Ingo Schiller, CFO of the club, said: "Today is the best day I have had since taking on a managerial role at Hertha BSC. The strategic partnership with KKR combines many advantages: deleveraging, additional equity, less cost pressure, and a reliable foundation for long-term planning. In KKR, one of the global leading investors, we have found the ideal partner."

Johannes P. Huth, head of KKR Europe, said: "We look forward to the opportunity of supporting Hertha BSC as a long-term partner and believe in the significant potential of strengthening the club's position both at home and abroad. Its large and loyal fan base, its unique development programme for young talents and the fact that it is the German capital's leading football club make Hertha an attractive partner for us."

Werner Gegenbauer, the president of Hertha BSC, said: "This is a ground-breaking agreement for Hertha BSC. For years, the executive committee has made finding a strategic partner its declared objective. Today, this wish has become reality. At the same time, we can promise that in future Hertha BSC will remain the same club it is today - just with a significantly improved economic situation."

The partnership was initiated with the support of the European investment firm IM 1872, which focuses on investments in the area of sports. Together with KKR, IM 1872 partners with Hertha BSC. Marc Mayor, managing partner of IM 1872, said: "Everyone knows that Berlin is 'the place to be' in Europe; we believe that Hertha is the 'club to be' in the football world."

The investment of KKR is facilitated by KKR Asset Management ("KAM").

About Hertha BSC
Founded in 1892, Hertha BSC is one of the German clubs with the longest tradition and with currently over 30,000 members, it is the biggest sports club in Berlin. The club in the German capital has won two German championships (in 1930 and 1931) and competes at the national top level in the German Football League. Its home games are carried out in Berlin's Olympic Stadium (which seats 74,244 spectators).

Hertha BSC's football academy for the development of young talent is one of the leading organisations of its kind in Germany. Almost 250 young players in the categories 'Under 9' to 'Under 23' form the foundation of Hertha BSC. The club has made training, educating and supporting football talents from the Berlin and Brandenburg region its premier objective.

For additional information, please visit Hertha BSC's website at www.herthabsc.de.

About KKR
Founded in 1976 and led by Henry Kravis and George Roberts, KKR is a leading global investment firm with $90.2 billion in assets under management as of September 30, 2013. With offices around the world, KKR manages assets through a variety of investment funds and accounts covering multiple asset classes. KKR seeks to create value by bringing operational expertise to its portfolio companies and through active oversight and monitoring of its investments. KKR complements its investment expertise and strengthens interactions with fund investors through its client relationships and capital markets platform. KKR & Co. L.P. is publicly traded on the New York Stock Exchange (NYSE: KKR) and "KKR", as used in this release, includes its subsidiaries, their managed investment funds and accounts, and/or their affiliated investment vehicles, as appropriate.

KKR has invested over $4.4bn in 15 private equity transactions in Germany since 1999. Across its current portfolio of companies globally, over 20 have operations in Germany, employing over 35,000 people in the country. The current portfolio includes companies such as Kion and WMF. In the past, KKR has helped to build up and expand several enterprises. For instance, KKR and Bertelsmann jointly developed BMG Rights Management into a leading global music rights business.

For additional information, please visit KKR's website at www.kkr.com.

About IM 1872
IM 1872 is an investment management firm which focuses on the European sports sector. IM 1872 sources, structures and manages investments in premier assets, focusing on the largest, most regulated sports markets in Europe. IM 1872 provides a unique combination of sports and finance sector networks and know how, with a focus on hybrid, convertible and equity investments, to provide investors with structured, diversified access to the sports sector's long term 12% annual revenue growth.

For additional information, please visit IM 1872's website at www.im1872.com.

Press contact Hertha BSC
Peter Bohmbach
Phone: +49 (0)30 - 300 928 281
Email: peter.bohmbach@herthabsc.de

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