KKR and EDF Partnership Helps Companies Save Over $16 Million While Reducing
Emissions and Waste
U.S. Foodservice, PRIMEDIA and Sealy demonstrate business and environmental
benefits
Business Wire
NEW YORK -- February 18, 2009
Kohlberg Kravis Roberts & Co. L.P. (KKR) and Environmental Defense Fund (EDF)
today released initial results of their partnership, confirming that
environmental management can drive business success even in today’s
challenging economic climate. At three companies – U.S. Foodservice Inc.,
PRIMEDIA Inc. and Sealy Corporation – the partnership has already saved $16.4
million and prevented more than 25,000 metric tons of greenhouse gas emissions
in 2008. KKR and EDF will soon implement the initiative at four additional KKR
portfolio companies: Accellent, Biomet, Dollar General and HCA.
“These initial results provide a high note in this low economy,” said Gwen
Ruta, vice president of corporate partnerships, EDF. “By generating cost
savings through environmental innovation, these companies are improving their
competitive position in today’s volatile marketplace.”
“One of KKR's core strengths is driving operational improvements that build
business value,” said Dean Nelson, Head of KKR Capstone. “By focusing on
improving environmental performance across KKR’s portfolio and providing a
framework to help companies take environmental initiatives to scale, we're
finding new ways to help the portfolio companies save money while
simultaneously improving the environment.”
Ken Mehlman, Head of Global Public Affairs at KKR said: “Today’s announcements
are good examples of how smart companies can cut costs and support the
environment. Going forward we will continue to implement Green Portfolio
Project tools to generate more cost savings and environmental benefits at
other portfolio companies including Accellent, Biomet, Dollar General and
HCA.”
KKR and EDF have been working together since May 2008 to develop and test a
set of analytic tools and metrics to help companies improve in several key
environmental performance areas, including greenhouse gas emissions, waste,
water, forest resources and priority chemicals.
U.S. Foodservice, PRIMEDIA and Sealy participated in the pilot phase of the
project, using these tools to evaluate environmental impacts, identify areas
for environmental and business improvement, establish baselines and metrics
and develop goals and action plans for future improvement. The process helped
managers to cost-effectively improve efficiency and reduce waste, while
addressing the environmental impacts of their business.
Specific results to date include:
U.S. Foodservice, one of the country’s premier foodservice distributors,
implemented new driver policies, business processes and truck technologies to
improve its operational efficiency and reduce emissions from its delivery
fleet. During 2008, U.S. Foodservice:
* Saved $8.2 million in fuel costs and avoided 22,000 metric tons of CO2
emissions (equivalent to more than 4,400 cars) by improving the efficiency
of its fleet (gallons/ton of product moved) by more than 4% compared to a
2007 baseline.
This year, U.S. Foodservice plans to further improve fleet productivity by
scaling up successful initiatives, such as driver awareness programs,
automatic idle shutoff, maximum speed controls and assessing and implementing
new initiatives, including improved trailer cooling practices and other
technology solutions.
PRIMEDIA, a leading provider of print, Internet and mobile solutions designed
to enable consumers to find a place to live, increased online efforts and
resized its publications to reduce its use of forest resources. During 2008,
PRIMEDIA:
* Saved $2.9 million in material costs and reduced more than 3,000 tons of
paper use (equivalent to over 40,000 trees) by improving efficiency (paper
use/revenue) by 22% compared to a 2007 baseline.
This year, PRIMEDIA plans to reduce paper consumption an additional 20% by
redesigning publications and pursuing additional online strategies and is
exploring opportunities to expand publication recycling programs currently
encouraged at all locations. Also in 2009, PRIMEDIA will focus on measuring
and reducing its greenhouse gas emissions 10% by improving sales and delivery
routing and continuing efforts to consolidate office and warehouse space.
Sealy Corporation, the largest bedding manufacturer in North America, recycled
raw materials used for producing bedding and improved delivery fleet
efficiency through improved driver policies and truck technologies to reduce
waste and decrease greenhouse gas emissions. During 2008, Sealy:
* Saved $1.2 million in fuel costs and avoided more than 3,000 metric tons
of CO2 emissions (equivalent to more than 600 cars) by improving the
efficiency of its fleet (gallons/stop) by almost 9% compared to a 2007
baseline. In addition, Sealy saved more than $4 million in material costs
and avoided 650 tons of solid waste (equivalent to the capacity of more
than 46 garbage trucks) by reducing scrap per bed (pounds/unit) by 16%
compared to a 2007 baseline.
This year, Sealy plans to roll out improved fleet routing software, install
speed governors on its trucks, reduce idling time and incentivize drivers to
improve fuel economy. ^ The company will continue reducing solid waste by
improving manufacturing processes and reducing packaging. In addition, Sealy
will focus on improving the energy efficiency of its facilities.
In 2009, KKR and EDF will continue to work together to extend the program
across KKR’s U.S. portfolio. Already, KKR has launched a Web site that
provides sample tools, best practices and case studies for cost-effectively
improving environmental performance to promote action among its portfolio
companies.
To drive broader change across the private equity and other industries, the
tools and best practices developed through the partnership will be available
through the EDF Innovation Exchange in the fall of 2009 and KKR and EDF will
continue to publicly share results.
About Environmental Defense Fund
A leading national nonprofit organization, Environmental Defense Fund
represents more than 500,000 members. Since 1967, Environmental Defense Fund
has linked science, economics, law and innovative private-sector partnerships
to create breakthrough solutions to the most serious environmental problems.
Environmental Defense Fund has a 20 year track record of success in partnering
with business. To maintain its independence and credibility, EDF accepts no
money from corporate partners; generous individuals and foundations fund its
work. For more information, please visit www.edf.org.
About Kohlberg Kravis Roberts & Co
Established in 1976, KKR is a leading global alternative asset manager. KKR’s
franchise is sponsoring and managing funds that make investments in private
equity, fixed income and other assets in North America, Europe, Asia and the
Middle East. Throughout its history, KKR has brought a long-term investment
approach, focusing on working in partnership with management teams of its
portfolio companies and investing for future competitiveness and growth. Funds
that KKR sponsors include traditional private equity funds and KKR Private
Equity Investors, L.P. (NYSE Euronext Amsterdam: KPE), a permanent capital
fund that invests in KKR-identified investments; two credit strategy funds,
KKR Financial Holdings LLC (NYSE: KFN) and the KKR Strategic Capital Funds,
which make investments in debt transactions; and separately managed accounts
focused on a variety of asset classes. KKR has offices in New York, Menlo
Park, San Francisco, Houston, Washington D.C., London, Paris, Hong Kong,
Tokyo, Beijing, Mumbai and Sydney. More information about KKR is available at:
www.kkr.com.
Gwen Ruta, Vice President - Corporate Partnerships, EDF
Gwen Ruta directs Environmental Defense Fund's Corporate Partnerships program.
She spearheads its work with leading multinational companies to develop
innovative, business-based solutions to environmental challenges and to drive
change through the corporate value chain.
Ranked #1 among environmental organizations for credible and effective
partnerships by the Financial Times, Gwen’s group has kicked off
transformations in market sectors from catalogs to shipping to retail to food
service. Partner companies have included Wal-Mart; UPS; FedEx; DuPont;
McDonalds and Citigroup.
Dean Nelson, Head of KKR Capstone
Dean B. Nelson founded KKR Capstone in 2000. He was formerly a senior partner
with The Boston Consulting Group, ran the firm's Chicago office and was on the
management committee. At The Boston Consulting Group, he focused primarily on
the consumer goods and retail, industrial goods and the high technology
industries. Mr. Nelson previously worked at Shell Oil Company. At KKR
Capstone, he has worked with Alliance Imaging, Dollar General, Energy Future
Holdings (formerly TXU Corp.), Owens-Illinois, PRIMEDIA, Rockwood/Dynamit
Nobel, Sealy, Toys 'R' Us, The Nielsen Company (formerly VNU Group) and Yellow
Pages Group. Mr. Nelson is Chairman of PRIMEDIA and is a Sealy and Dollar
General board member. He holds a B.S., Summa Cum Laude, from Purdue University
and an M.B.A., with High Honors, from The University of Chicago.
Ken Mehlman, Head of Global Public Affairs at KKR
Ken B. Mehlman joined KKR in 2008 and is Head of Global Public Affairs. Prior
to joining KKR, Mr. Mehlman was a partner at Akin Gump Strauss Hauer & Feld
with a bi-partisan practice in legislative and regulatory counseling. He
previously served in high level positions on Capitol Hill and the White House,
including as Chairman of the Republican National Committee and Campaign
Manager of President Bush's successful re-election campaign. Mr. Mehlman
graduated with a B.A. from Franklin & Marshall College and holds a J.D. from
Harvard Law School.
Contact:
Environmental Defense Fund
Melanie Janin, 202-572-3240
mjanin@edf.org
or
KKR
Peter McKillop or Kristi Huller, 212-750-8300
media@kkr.com
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