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Possible Domo takeover of all sports activities of DESSO Sports Systems

08 August 2012

The Management Board of Desso Holding BV (hereinafter referred to as 'Desso') hereby announces its intention to sell all the Sports activities to Domo Industries BV, headquartered in St. Niklaas, Belgium (hereinafter referred to as 'Domo'). As part of this plan, Desso will continue with the extrusion of the unique iDNA and iDNA-X artificial grass yarns for Domo.

Subsequent to Desso's announcement on 20 June regarding its plan to stop its tufting and coating operations in Dendermonde, many parties have approached Desso, offering to tuft and finish artificial grass pitches.

One of these was Domo. Initially, the discussions focused on a possible long-term relationship between Domo and Desso, whereby Domo would tuft and finish artificial grass pitches for Desso. However, as these discussions progressed, Domo only saw potential in tufting and finishing if it was given complete control over Desso's artificial grass activities.

The outcome of these discussions is that Domo not only intends to take over the tufting and coating operations from the Desso Sports Division, but also the development, sales, marketing, installation & maintenance of Desso's artificial grass and Desso GrassMaster pitches and the Desso Sports Systems brand. This would create a strong, consolidated and profitable player in the international artificial grass market. For Domo, this would mean more than a doubling of the artificial grass sales and production activities. In this plan, Domo will continue to market both strong brands, Desso Sports Systems and Domo, alongside each other.

For Desso, this plan means that it will be able to focus even better on its core business, i.e. carpet tiles and carpet for the commercial and consumer market, while Domo can focus entirely on a healthy and considerably more extensive artificial grass business.

In practice, this plan means that in Belgium 27 production employees will move from Desso Dendermonde to Domo St. Niklaas and that nearly all the Desso Sports employees in development, sales, marketing, installation, maintenance of artificial grass and Desso GrassMaster will be transferred to Domo. The plan involves very few redundancies (less than 10) within the current international Desso Sports division.

The constructive discussions will be continued with Domo in the coming weeks and we have every confidence that this will lead to Domo taking over Desso's sports activities as described above.

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