The KD can trace its history back to 1853 when two earlier companies, the Preussisch-Rheinischen Dampfschiffahrtsgesellschaft (PRDG), the "Koln" company and the Dampfschiffahrtsgesellschaft fur den Nieder- und Mittelrhein (DGNM), the "Dusseldorf" company, merged at a time of intense competition and the in response to the loss of much of the freight and passenger traffic along the Rhine following the expansion of the railways along its banks.
Despite the merger, the two companies, which were established in 1826 and 1836 respectively, maintained semi-independent operations ordering their own vessels which were known as "Koln" or "Dusseldorf" boats. Although other companies operated vessels during this period, especially in the more northerly and southerly stretches of the river, the KD came to dominate and absorb the competitors, such as the Mulheim Company (MDAG), with the exception of the Dutch Steamboat Company (NSM/NSR), which traced its inception back to 1823, when steam was first intoduced for passenger and goods transport. From 1927, Dutch and German services were run in cooperation and there was some interchange in vessel ownership.
The first trials of a steamboat on the Rhein were in 1816, when the new form of propulsion was demonstrated by English interests, and the link was developed when the DGNM was established with links to the General Steam Navigation Company, with a view to establishing services down the Rhein from the U.K. (source Paddle steamer)