Hydro Annual Report 2011b

which result in recognition of indemnification assets of approximately NOK 150 million. The fair value of Hydro's previous
ownership interests in Alunorte and CAP is part of the initial recognition of the acquired entities. A remeasurement gain of
NOK 4,222 million was recognized in Other income, net.
The values of assets acquired and liabilities assumed are included in the table below:
Amounts in NOK million
FINANCIAL STATEMENTS
Note 5 - Acquisitions F19
Cash and cash equivalents 347
Short­term investments 188
Receivables 1 297
Other current assets 389
Inventories 2 177
Total current assets 4 398
Property, plant and equipment 43 439
Other non­current assets 4 950
Intangible assets excluding goodwill 3 043
Goodwill 3 499
Total non­current assets 54 930
Bank loans and other interst bearing short­term debt 2 086
Other current liabilities 1 732
Total current liabilities 3 818
Long­term debt 4 818
Other long­term liabilities 1 998
Deferred tax liabilities 5 341
Total non­current liabilities 12 157
Minority interests 6 470
Fair value of Hydro's interests as of the business combination 36 883
The majority of receivables were towards shareholders related to their right and obligation to purchase products from the
entities. Receivables have been collected.
Hydro has elected to utilize the option to measure non-controlling interests (minority interests) at their proportionate share of
the acquiree's identifiable net assets. Minority interests are recognized with NOK 4,154 million related to the 49 percent
minority in Albras, with NOK 2,200 million related to the 9 percent minority in Alunorte and with NOK 116 million related
to the 19 percent minority in CAP. Goodwill is measured at NOK 3,499 million. Goodwill is allocated to one cash generating
unit in Bauxite & Alumina. The main reasons for identification of goodwill are synergies in the common location of plants and
mine and the difference between nominal value and fair value of deferred tax. No amount of goodwill is expected to be
deductible for tax purposes.
Hydro had existing contracts and balances with Vale Aluminium, primarily an off-take arrangement for alumina as part of the
equity investment in Alunorte including related payables, receivables and loans. In addition, the acquiree held certain long-term
sales contracts with Hydro. The fair value of the contracts has been determined to be a liability for the acquiree because the
contract terms were below market value at the time of acquisition. The difference was accounted for as settlement of a preexisting
relationship resulting in a credit to Other income, net, of NOK 267 million. In addition, an existing loan to Alunorte
at below market interest was accounted for as settlement of a pre-existing loan resulting in a charge of NOK 68 million
included in Other income, net. These amounts have been excluded from the purchase price and purchase accounting.
Acquisition related costs incurred during 2011 were approximately NOK 20 million, in total for the transaction approximately
NOK 90 million, included in operating costs.
Results of the acquired businesses are included in Hydro's consolidated income statement as of February 28, 2011. The
acquired businesses are an integral part of Hydro's operations and are not reported separately. The acquired businesses
contributed about NOK 11,500 million to the group's revenue in the period after acquisition, and about NOK 330 million to
EBIT.