Notes to the financial statements

Notes to the financial statements

2. Acquisitions
Acquisitions in 2016
Acquisition of Anvia's ICT companies
Elisa acquired 100 per cent of shares in Anvia Telecom Oy, Anvia IT-Palvelut Oy, Anvia Hosting Oy, Anvia TV Oy and Watson Nordic Oy on 1 July 2016. The acquisition price was EUR 107.5 million, including a capital loan acquired as a part of the acquisition. Elisa paid the acquisition price with shares in Anvia Oyj, cash and shares in the subsidiary Tansec Oy.
Through this acquisition, Elisa strengthens its market position in the field of activity of Anvia's ICT companies.
EUR 7.8 million of the purchase price is allocated to the customer base. EUR 7.1 million of the customer base is allocated to fixed broadband customerships and is amortised over five years, and EUR 0.7 million is allocated to IT customership and is amortised over four years. The acquisition resulted in EUR 59.9 million of goodwill relating to market access in the field of activity of the purchased entities and expected synergy benefits. Goodwill is not tax deductible.
The acquired companies have been consolidated from 1 July 2016 onwards. Revenue after the acquisition was EUR 35.9 million and profit for the period EUR 7.1 million. Had the acquisition been made as of the beginning of the year, the impact on Group revenue and profit for the period would have been EUR 73.3 million and EUR 5.5 million, respectively.
There were no pre-existing relationships between the Group and the acquired company at the time of the acquisition that should be taken into account in the consolidation of the business operations.
Consideration transferred    
EUR million   Carrying amount
Anvia Oyj shares   78.3
Tansec Oy shares   1.1
Cash paid   28.2
Total cost of acquisition   107.5
     
Analysis of net assets acquired    
EUR million    
Customer base   7.8
Other intangible assets   0.5
Tangible assets   43.4
Equity investments and funds   1.4
Deferred tax assets   2.9
Inventories   2.2
Trade and other receivables   11.0
Cash and cash equivalents   2.2
Deferred tax liabilities   -4.8
Pension liabilities   -0.4
Provisions   -0.4
Accrued expenses and other liabilities   -18.0
    47.6
Effects of acquisition on cash flow    
EUR million    
Purchase price paid in cash   -27.0
Cash and cash equivalents of the acquired entities   2.2
    -24.8
     
Goodwill arising from business combination
EUR million    
Consideration transferred   107.5
Net assets acquired   47.6
Goodwill   59.9
The acquisition resulted in a EUR 1.7 million expense of transfer tax, which has been recorded in other operating expenses. In addition, a EUR 0.1 million expense of fees for experts and professional advisors is recorded in other operating expenses.
Acquisition of Frandel Oy
On 5 July 2016, Elisa acquired all shares of Frandel Oy. The purchase price was EUR 0.3 million. The business combination resulted in goodwill of EUR 0.1 million. The goodwill writedown is recognised as other operating expenses and is not tax deductible. On 8 September 2016, the business changed its name to Ekaso Oy.
The acquired company is consolidated from 1 July 2016 onwards.
There were no pre-existing relationships between the Group and the acquired company at the time of the acquisition that should be taken into account in the consolidation of the business operations.
Consideration transferred    
EUR million   Carrying amount
Cash paid   0.3
Total cost of acquisition   0.3
     
Analysis of net assets acquired    
EUR million    
Equity investments and funds   0.1
Cash and cash equivalents   0.1
    0.2
Effects of acquisition on cash flow    
EUR million    
Purchase price paid in cash   -0.3
Cash and cash equivalents of the acquired entity   0.1
    -0.2
Goodwill arising from business combination    
EUR million    
Consideration transferred   0.3
Net assets acquired   0.2
Goodwill   0.1
Acquisitions in 2015
Acquisition of Banana Fingers Ltd
Elisa acquired all shares of Banana Fingers Ltd, which is a part of the EpicTV business. The purchase price was EUR 3.3 million, including a contingent consideration of EUR 1.4 million. The business combination resulted in goodwill of EUR 2.9 million. The goodwill resulted from the acquisition of e-commerce know-how and a business concept, and faster access to the sports equipment e-commerce market for consumer customers. Goodwill is not tax deductible.
Banana Fingers is consolidated from 1 January 2015 onwards.
There were no pre-existing relationships between the Group and the acquired company at the time of the acquisition that should be taken into account in the consolidation of the business operations.
Analysis of net assets acquired    
EUR million   Carrying amount
Inventories   0.3
Cash and cash equivalents   0.3
Trade payables and other current liabilities   -0.2
    0.4
Effects of acquisition on cash flow    
EUR million    
Purchase price paid in cash   -1.9
Cash and cash equivalents of the acquired entity   0.3
    -1.6
Acquisition of Datawell Oy’s MDM (Master Data Management) business
On 31 August 2015, Elisa Appelsiini acquired Datawell Oy's MDM business. The purchase price was EUR 2.0 million. The business combination resulted in goodwill of EUR 0.8 million. The acquisition strengthens the supply of Elisa's digital healthcare services and supports the development of new services. Goodwill is not tax deductible.
There were no pre-existing relationships between the Group and the acquired business at the time of the acquisition that should be taken into account in the consolidation of the business operations.
Analysis of net assets acquired    
EUR million   Carrying amount
Contract base   1.5
Current assets   0.1
Deferred tax liabilities   -0.3
Accruals and other current liabilities   -0.1
    1.2
Effects of acquisition on cash flow    
EUR million    
Purchase price paid in cash   -2.0
Acquisition of Fonum Oy
On 7 September 2015, Elisa acquired all shares of Fonum Oy. The purchase price was EUR 0.6 million. The business combination resulted in EUR 0.4 million goodwill relating to market access in the mobile phone service and repair business. Goodwill is not tax deductible.
Fonum is consolidated from 1 September 2015 onwards.
There were no pre-existing relationships between the Group and the acquired company at the time of the acquisition that should be taken into account in the consolidation of the business operations.
Analysis of net assets acquired    
EUR million   Carrying amount
Intangible assets   0.1
Property, plant and equipment   0.0
Inventories   0.1
Trade and other receivables   0.0
Cash and cash equivalents   0.1
Accruals and other liabilities   -0.2
    0.2
Effects of acquisition on cash flow    
EUR million    
Purchase price paid in cash   -0.6
Cash and cash equivalents of the acquired entity   0.1
    -0.5
Acquisition of Livezhat business
On 31 October 2015, Elisa acquired ZEF Oy's Livezhat service business. The purchase price was EUR 0.5 million. The business combination resulted in EUR 0.3 million goodwill relating to the improvement of the range of services for corporate customers. Goodwill is not tax deductible.
There were no pre-existing relationships between the Group and the acquired business at the time of the acquisition that should be taken into account in the consolidation of the business operations.
Analysis of net assets acquired    
EUR million   Carrying amount
Customer base   0.2
Deferred tax liabilities   -0.0
    0.2
Effects of acquisition on cash flow    
EUR million    
Purchase price paid in cash   -0.5

Tell a friend

Your name
Your email
 
Email title
Message
 
Friends emails

 Add friend