Philips 2008 Annual Report Download - page 144

The following table summarizes the fair value of Respironics’ assets
and liabilities:
March 10, 2008
Total purchase price (net of cash) 3,196
Allocated to:
Property, plant and equipment 137
Other non-current financial assets 10
Working capital 215
Deferred tax liabilities (439)
Provisions (27)
Long-term debt (48)
In-process R&D 3
Other intangible assets 1,183
Goodwill 2,162
3,196
The goodwill recognized is related to the complementary technical
skills and talent of the Respironics workforce and the synergies
expected to be achieved from integrating Respironics into the
Healthcare sector.
The amount of in-process research and development acquired and
written off in 2008 was EUR 3 million. This amount is included in
the consolidated statement of income under Research and
development expenses.
Other intangible assets, excluding in-process research and
development comprise:
amount
amortization
period in years
Core technology 355 9-13
Developed non-core technology 21 4-7
Trade name 72 6
Customer relationships 732 16-18
Other 3 1-3
1,183
Respironics contributed income from operations of EUR 6 million
to the Group for the period from March 10 to December 31, 2008.
VISICU
On February 20, 2008, Philips acquired 100% of the shares of VISICU,
a leading IT company which develops remote patient monitoring systems.
The acquisition of VISICU will facilitate the creation of products to
provide increased clinical decision support to hospital staff, while
allowing them to monitor a greater number of critically ill patients.
Philips paid a net cash consideration of EUR 198 million. As of the
acquisition date, VISICU has been consolidated as part of the
Healthcare sector.
The following table summarizes the fair value of VISICU’s assets
and liabilities:
February 20, 2008
Total purchase price (net of cash) 198
Allocated to:
Working capital (4)
Deferred tax liabilities (4)
Defered revenue (2)
In-process R&D 4
Other intangible assets 29
Goodwill 175
198
The goodwill recognized is related to the complementary technological
skills and talent of VISICU’s workforce and the synergies expected to
be achieved from integrating VISICU into the Healthcare sector.
The amount of in-process research and development acquired and
written off in 2008 was EUR 4 million. This amount is included in
the consolidated statement of income under Research and
development expenses.
Other intangible assets, excluding in-process research and
development comprise:
amount
amortization
period in years
Core technology 20 7
Patents and trademarks 1 6
Customer relationships 5 2-15
Backlog 3 1-3
29
VISICU contributed a loss from operations of EUR 16 million to the
Group for the period from February 20 to December 31, 2008.
Pro forma disclosures on acquisitions
The following table presents the year-to-date unaudited pro-forma
results of Philips, assuming Genlyte, Respironics and VISICU had been
consolidated as of January 1, 2008:
Unaudited
January-December 2008
Philips
Group
pro forma
adjustments1)
pro forma
Philips
Group
Sales 26,385 230 26,615
Income (loss) from
operations 317 (7) 310
Net income (loss) (186) (7) (193)
Basic earnings per share –
in euros (0.19) (0.19)
Pro forma adjustments include sales, income from operations and net income
1)
from continuing operations of the acquired companies from January 1, 2008
to the date of acquisition. As Philips finances its acquisitions with own funds,
the pro forma adjustments exclude the cost of external funding incurred prior
to the acquisition. The pro forma adjustments reflect the impact of the
purchase-price accounting effects from January 1, 2008 to the date of
acquisition and elimination of non-recurring integration costs. Purchase-price
accounting effects primarily relate to the amortization of intangible assets
(EUR 36 million, excluding the write-off of research and development assets).
The non-recurring integration costs primarily relate to the accelerated vesting
of stock options (EUR 255 million)
Philips Annual Report 2008144
180
Sustainability performance
192
IFRS financial statements
244
Company financial statements
124
US GAAP financial statements
Notes to the US GAAP
financial statements