Annual Report 2012 - Dialog

122 l Dialog Axiata PLC l Annual Report 2012
Notes to the Financial Statements
36 Business combinations
Acquisition of Suntel Limited
(a) The Company’s wholly owned subsidiary, Dialog Broadband Networks (Private) Limited (DBN), entered into a Share
Purchase Agreement on 14 December 2011 with the shareholders of Suntel Limited (Suntel) to purchase 100
percent equity shares of Suntel. Suntel became a wholly owned subsidiary of DBN with effect from 21 March 2012
and accordingly the assets and liabilities of Suntel Limited were consolidated into the Group. The total consideration
for the acquisition of Suntel was Rs. 4,057,918,108 which was fully settled as at 30 September 2012 in cash in
accordance with Share Purchase Agreement . The resultant goodwill to the Group on the acquisition was
Rs. 6,353,391,403.
(b) Suntel was amalgamated with DBN, in accordance with provisions of the Companies Act, No. 07 of 2007 (the
“Act”) with effect from 15 May 2012. Accordingly, Suntel ceased to exist and was removed from the Register by the
Registrar-General of Companies and all the assets, rights, liabilities and obligations of Suntel were succeeded by
DBN in accordance with the Act.
(c) The following table summarises the consideration paid for Suntel Limited, the fair value of assets acquired,liabilites
assumed at the acquisition date.
Consideration at 31 December 2012: Amount (‘000)
Cash 4,057,918
Total consideration transferred 4,057,918
Recognised amounts of identifiable assets acquired and liabilities assumed:
Cash and cash equivalents 228,527
Property, plant and equipment (Note 8) 2,041,746
Intangibles 214,136
Trade and other receivables 1,672,022
Trade and other payables (5,770,565)
Provision for other liabilities (123,522)
Pre-paid revenue (201,746)
TDC disbursement (191,434)
Retirement benefit obligation (94,476)
Borrowings (56,546)
Finance lease liabilities (13,615)
Total net assets acquired (2,295,473)
Goodwill 6,353,391
Total 6,353,391
(d) Goodwill primarily consist of expected growth potential of the combined operation.
(e) The amount of revenue and the net results of Suntel Limited has been reported together with DBN since Suntel was
amalgamated with DBN as disclosed in (b) above.