Annual Accounts and Report as at 30 June 2011 Draft - Mediobanca

PART G - COMBINATIONS INVOLVING GROUPCOMPANIES OR BUSINESS UNITSSection 1Transactions completed during the yearAt the end of the 2008 financial year, Compass acquired 100% of Linea for aconsideration of €405m. Linea, a leading operator in consumer credit, had thefollowing, fully-owned subsidiaries: Futuro (salary-backed finance) and Equilon(internet banking). It also had a 50:50 joint venture with Ducati to providefinance for purchasing motorcycles, and exercised de facto control oversecuritization vehicle company Jump.Completion of the purchase price allocation procedure required under IFRS3, resulted in goodwill of €365.9m and specific intangible assets, recordedseparately and not recognized in the accounts of the acquired companies, worth€50.5m. The following values in particular were established:(€’000)Intangible assets with defined life ......... 44,200of which: – commercial agreements ... 19,300– customer relationships .... 24,900Brands .................................... 6,300Mismatch between other assets/liabilities . . 2,729Tax effects ................................ (12,155)Goodwill ................................. 365,934Consideration paid ........................ 407,008of which: ancillary charges ........... 2,008The intangible assets with defined lives have an average duration of 7.8years (up to a maximum of ten years), and have been amortized over the threeyears as to approx. €17.5m; at 30 June 2011 they were valued at €26.7m. Allbrands have been considered as having indefinite lives, and involve consumer– 225