APC 2004 Annual Report Download - page 75

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Andover Controls goodwill
The Andover Controls Group, which comprises ten
subsidiaries, was consolidated for the first time as of
July 1, 2004. The related goodwill has been calculated
on the basis of the financial statements at that date.
In millions In millions
of US dollars of euros*
Acquisition price 404.1 332.4
Fair value of the assets
and liabilities acquired
Net assets acquired
at July 1, 2004 51.4 42.3
Fair value adjustments to
assets and liabilities acquired (20.1) (16.6)
Development costs 3.6 3.0
Trademarks 44.9 36.9
Fair value of net assets
at July 1, 2004 79.8 65.6
Goodwill 324.3 266.8
*On the basis of the exchange rate on July 1, 2004:
US 1.00 =  0.82271
The Group has until June 30, 2005 to complete its fair
value adjustments to acquired assets and liabilities
and to value intangible assets, in order to determine
the final amount of goodwill.
Kavlico goodwill
Kavlico Corp. in the United States and Kavlico GmbH
in Germany have been fully consolidated since July 1,
2004.
The Group has until June 30, 2005 to complete its fair
value adjustments to acquired assets and liabilities
and to value intangible assets, in order to determine
the final amount of goodwill.
The initial estimate of goodwill is as follows:
In millions In millions
of US dollars of euros*
Acquisition price,
net of expenses 196.4 161.6
Value of the assets
and liabilities acquired
Net assets acquired
at July 1, 2004 55.8 45.9
Fair value adjustments to
assets and liabilities acquired (3.2) (2.6)
Fair value of net assets
at July 1, 2004 52.6 43.3
Goodwill 143.8 118.3
*On the basis of the exchange rate on July 1, 2004:
US 1.00 =  0.82271
MGE UPS Systems goodwill
MGE UPS Systems has been fully consolidated since
January 1, 2004. The goodwill on the aggregate
48.7 % interest acquired in Feburary and November
2004 has been calculated as follows:
Acquisition price,
net of transaction expense 262,5
Value of shares previously held 79,9
Total value of shares 342,4
Fair value of the assets
and liabilities acquired (Group share)
Net assets acquired at January 1, 2004 127,2
Cancellation of previous goodwill (428,2)
Fair value adjustments to the assets
and liabilities acquired 7,5
Trademark 254,5
Fair value of net assets
at January 1, 2004 (39,0)
Goodwill 381,4
In line with accounting standards concerning step-by-
step acquisitions, the additional goodwill was recog-
nized as follows:
The acquired assets and liabilities were restated at
fair value, leading to total adjustments of 15.4 mil-
lion, of which 7.5 million group share. The 5.5 mil-
lion revaluation difference corresponding to the previ-
ously held interest was directly recorded in consoli-
dated reserves.
100 % of the MGE trademark was recognized in an
amount of 300 million (including group share of
254.5 million).
Total goodwill was booked in an amount of 381.4
million including:
- 80.1 million corresponding to the historic 32.3 %
interest owned and carried on the MGE balance
sheet.
- 7.7 million corresponding to the 3.8 % interest
acquired in 2003.
- 290.9 million corresponding to the purchase of
48.1 % interest acquired in 2004.
- 2.7 million corresponding to the 0.6 % acquired in
November 2004.
The acquisition price reflects
A deferred consideration of 24.2 million, discount-
ed to present value, and
An earn-out payment currently estimated at 24
million, whose final amount will be based on MGE's
earnings at September 30, 2005.
In addition, the Group has agreed to purchase the
15.2 % of outstanding shares held by minority inter-
ests, for a price, based on MGE earnings at Septem-
ber 30, 2005, that is currently estimated at an aggre-
gate 76.5 million.
Consolidated financial statements