Weir Group 2013 Interim Report (PDF, 0.59 MB) - The Weir Group

7. Property, plant & equipment & intangible assets52 weeks ended28 Dec 2012£mAdditions of property, plant & equipment & intangible assets26 weeks ended28 June 2013£m26 weeks ended29 June 2012£m27.9 Land & buildings 5.6 6.687.4 Plant & equipment 33.1 46.38.3 Intangible assets 9.0 2.7123.6 47.7 55.68. Business combinationsOn 31 December 2012, the Group completed the acquisition of 100% of the voting shares of Mathena, Inc (‘WeirMathena’) for a cash consideration of US$247m (£153m) with a maximum future payment of US$145m payableover two years. Of this future payable, US$120m is contingent consideration and US$25m is an employee benefitexpense which will be recognised as and when it is paid, based on the ongoing employment of the individuals.The full amount is contingent upon meeting profit growth targets and based on vendor forecasts at the date ofacquisition we currently expect that the full amount will be payable. We have discounted the element of contingentconsideration over the period in which it is expected to fall due, resulting in a deferred liability of £60m at theacquisition date. Based in El Reno, Oklahoma Weir Mathena is a leading provider of pressure control rentalequipment and services for onshore oil and gas drilling applications. The fair values of Weir Mathena are disclosedin the following table. The fair values are provisional pending the completion of the fair value exercise in respect ofeach class of asset and will be finalised during the second half of the financial year. There will be certain intangibleassets included in the £61m of goodwill recognised that cannot be individually separated and reliably measureddue to their nature. These items include anticipated business growth, intellectual property, synergies and anassembled workforce.During the period the Group also acquired 100% of the voting shares of the R Wales group of companies (‘WeirWales’), 100% of the voting shares of Aspir Pty Limited in Australia, the business and assets of the Cheong foundryin Malaysia, and a heavy bay foundry in South Africa. The combined consideration for these acquisitions was £54m,with an expected contingent consideration of £2m. The fair values of these acquisitions are disclosed in the tablebelow and are provisional pending the finalisation of the complete fair value exercise in respect of each class ofasset for each acquisition. The fair values will be finalised during the second half of the financial year. There will becertain intangible assets included in the £31m of goodwill recognised that cannot be individually separated andreliably measured due to their nature. These items include anticipated business growth, synergies and anassembled workforce.27