It doesn't sound so bad to me. There is clearly a problem with all the distortions caused by the proliferation of "Uberhangt mandaten" that needed to be solved and this seems like as a good a way as any to solve it.
Having single member districts that may not return any member is dumb as *** and the whole reason for this reform is to reduce the number of elected politicians which is cheap populist drivel. Germany still has fewer parliamentarians per citizens than UK, France, Spain and Canada! The most simple and straightforward way to solve the overhang problem is to force the CDU/CSU to run in a single list which would reduce the number of extra compensation mandates by almost a 100. This can be accomplished without touching the electoral system at all.
