  [Abridged]. Here, we report on the discovery of the galaxy counterpart of the
z_abs=2.58 DLA on the line-of-sight to the z=3.07 quasar SDSS
J091826.16+163609.0. The galaxy counterpart of the DLA is detected in the OIII
5007 and OII 3726,3729 emission lines redshifted into the NIR at an impact
parameter of 16 kpc. Ly-alpha emission is not detected. The upper limit implies
that Ly-alpha emission from this galaxy is suppressed by more than an order of
magnitude. The DLA is amongst the most metal-rich DLAs studied so far at
comparable redshifts. We find evidence for substantial depletion of refractory
elements onto dust grains. Fitting the main metal line component of the DLA,
which is located at z_abs=2.5832 and accounts for at least 85% of the total
column density of low-ionisation species, we measure metal abundances from
ZnII, SII, SiII, CrII, MnII, FeII and NiII of -0.12, -0.26, -0.46, -0.88,
-0.92, -1.03 and -0.78, respectively. In addition, we detect absorption in the
Lyman and Werner bands of hydrogen, which represents the first detection of H_2
molecules with X-shooter. The background quasar Q0918+1636 is amongst the
reddest QSOs at redshifts 3.02<z<3.12 from the SDSS catalogue. Its UV to NIR
spectrum is well fitted by a composite QSO spectrum reddened by SMC/LMC-like
extinction curves at z_abs=2.58 with a significant amount of extinction given
by A_V = 0.2 mag. This supports previous claims that there may be more
metal-rich DLAs missing from current samples due to dust reddening of the
background QSOs. The fact that there is evidence for dust both in the central
emitting regions of the galaxy (as evidenced by the lack of Ly-alpha emission)
and at an impact parameter of 16 kpc (as probed by the DLA) suggests that dust
is widespread in this system.
