Shareholders' Letter

Business combinations
In the case of business combinations, assets and liabilities acquired are measured at fair value at
the date of acquisition. In determining the fair value of the intangible assets and property, plant
and equipment acquired, of the liabilities assumed at the date of acquisition as well as the useful
lives of the intangible and tangible assets acquired, certain assumptions are made. The measurement
is based upon projected cash flows and on information available at the date of acquisition.
Actual cash flows may differ significantly from those assumed in determining fair values. See
Note 5.
5 Changes in scope of consolidation
and purchase of minority interests
Business combinations in 2010
Payments totalling CHF 39 million were made in 2010 for the acquisition of Group companies. Of
this amount, CHF 6 million is for deferred consideration payments for business combinations in
prior years and CHF 33 million for businesses acquired in 2010. The newly acquired companies in
2010 are viewed each as non-significant business combinations and they are thus reported on an
aggregate basis.
On 30 April 2010, Swisscom Switzerland acquired the Swiss operating and service business of
Siemens Enterprise Communications. In addition, on 15 December 2010, Swisscom Switzerland
acquired the entire share capital of Axept Ltd which offers services primarily in the fields of consulting
and engineering as well as outsourcing. On 7 May 2010, Swisscom IT Services completed
the acquisition of the entire share capital of Panatronic Schweiz Ltd which is active in the area of
printer solutions as well as servicing and repairs. After acquisition, Panatronic Schweiz Ltd changed
its name to Swisscom IT Services Workplace Ltd. On 23 July 2010, Swisscom Hospitality Services
completed the acquisition of 100% of the share capital of Wayport Holding A/S. Wayport provides
network-based services to hotels in Europe, the Middle East and Africa (EMEA) for use by their
guests.
The aggregate allocation of acquisition costs to the net assets may be analysed as follows:
Pre-acquisition Post-acquisition
In CHF million carrying amount Adjustments carrying amount
Cash and cash equivalents 8 – 8
Trade and other receivables 15 – 15
Other financial assets 2 – 2
Property, plant and equipment 8 – 8
Other intangible assets – 22 22
Other current and non-current assets 7 – 7
Financial liabilities (7) – (7)
Trade and other payables (13) – (13)
Defined benefit obligations (3) – (3)
Deferred tax liabilities – (4) (4)
Other short- and long-term liabilities (7) – (7)
Identifiable assets and liabilities 10 18 28
Goodwill 15
At cost 43
Cash and cash equivalents acquired (8)
Deferred payment of purchase price (2)
Cash outflow 33