APC 2004 Annual Report Download - page 95

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17.4 - Ordinary bonds
On April 14, 1999, Schneider Electric issued 750
million worth of 3.75% bonds due April 14, 2004. On
May 28, 1999, a further 250 million worth of bonds
was issued at the same interest rate and with the
same maturity. The second issue is treated as a sec-
ond tranche of the first. The Group redeemed bonds
totaling 49 million in 2003 and 951 million in 2004.
On October 19 and 20, 2000, Schneider Electric
issued two tranches of 6.1275 % bonds due October
19, 2007, in principal amounts of 400 million and
50 million, respectively.
These bonds are traded on the Euronext Paris and
the Luxembourg stock exchanges.
On October 31, 2003, Schneider Electric issued
750 million worth of 3.875% bonds due October 31,
2008.
This bond is traded on the Luxembourg stock
exchanges.
17.5 - Other information
At December 31, 2004, Schneider Electric had
unused confirmed credit lines of 837 million. These
lines of credit are available for the period.
Note 18 - Other
Long-Term Liabilities
(in millions of euros) Dec. 31, 2004 Dec. 31, 2003
MGE UPS
acquisition debt 48.6 -
Clipsal
acquisition debt 35.6 40.5
Magnecraft assets
acquisition debt 16.2 -
Abacus
acquisition debt 3.1 -
Other 0.9 -
Other long-term
liabilities 104.4 40.5
The acquisition price for MGE UPS Systems includes
an earn-out payment currently estimated at 24 mil-
lion and deferred consideration of 24.6 million, dis-
counted to present value at December 31, 2004.
The agreement covering the acquisition of Clipsal
includes a clause providing for the payment of part of
the price in 2007. This amount is being held in escrow
(see Note 8.3).
As part of the agreement covering the acquisition of
Abacus, $ 4.3 million will be paid in 2006 and 2007.
Note 19 - Commitments
19.1 - Guarantees given and received
(in millions of euros) Dec. 31, 2004 Dec. 31, 2003
Performance bond
counter-guarantees (1) 171.0 175.0
Mortgages
and collateral (2) 33.4 28.2
Guarantees 4.2 1.6
Other (3) 209.1 226.9
Guarantees given 417.7 431.7
Guarantees 33.6 29.9
Guarantees received 33.6 29.9
(1) In certain contracts, customers require a guarantee from a
bank that the contract will be fully executed by the Group. For
these contracts, the Group gives a counterguarantee to the bank.
If a claim occurs, the risk linked to the commitment is assessed
and a reserve for contingencies is recorded when the risk is con-
sidered probable and reasonably estimable.
(2) Certain loans are secured by securities lodged as collateral.
(3) Other guarantees given primarily comprise letters of credit
issued by the US subsidiary, Square D Company, and guarantees
to some lessors that rental payments will be made until the end
of the lease.
19.2 - Purchase commitments
Shares
Commitments to purchase shares correspond to con-
tractual undertakings given by the Group to buy out the
minority shareholders of consolidated companies.
They also include any earn-out payments due on pre-
vious acquisitions. At December 31, 2004, these com-
mitments totaled 150 million and concerned mainly
MGE UPS for an amount of 76.5 million (see Note
3.3).
Information technology services
In October 2004, the Group signed an agreement with
Capgemini to outsource its European IT functions
(800 employees) and deploy shared management
applications. The agreement will be implemented
country by country in 2005 and 2006. It did not have
any material impact on the financial statements at
December 31, 2004.
As part of the agreement covering the acquisition of
Magnecraft, $ 22 million was paid in January 2005 and
recorded under acquisition debt at December 31, 2004.
Consolidated financial statements