Annual Report of ACS Group - Grupo ACS

Finally, and in order to complete the analysis on the need (or not) of impairment of the investment that the Group has
made, several valuations have been requested from well-established independent experts that clearly show a valuation of
the investment that is greater than the average cost of EUR 7.31 per share. The valuations do not include any premium that
in all cases would be included in a corporate transaction for an ownership interest such as the one held by the ACS Group
in Iberdrola.
In accordance with the above, the Directors of the ACS Group deem that there are no factors that would mean the existence
of impairment at the closing of the 2010 period, placing its recoverable value above the cost of the ownership interest.
Therefore, upon having analysed the existing signs of impairment on the investment at closing and concluding, based
upon the above arguments, that there is no signifi cant or prolonged drop in the fair value of the investment, the valuation
adjustments in the amount of EUR 1,196,901 thousand have been maintained under said heading, without recording any
impairment against the period profi ts.
Xfera Móviles, S.A.
At 31 December 2010 and 2009, the ACS Group had a 17% ownership interest in the capital of Xfera Móviles, S.A. through
ACS Telefonía Móvil, S.L. after the sale of part of its interest in 2006 to the Telia Sonera Group. In relation to this sales
transaction, there is an unrecognised contingent price, and in certain scenarios, puts and calls on the ACS interest, which
conditions for exercising are unlikely to be met.
The book value of the holding and loans in Xfera Móviles S.A. on 31 December 2010 amounted to EUR 198,376 thousand
(EUR 188,346 thousand on 31 December 2009) after the contributions made, including the participation loans associated
with the same for the amount of EUR 119,170 thousand included under the heading “Other non-current loans”. Said book
value corresponds to the contributions made after 2006, with the Group having posted in previous periods very relevant
provisions in relation to said ownership interest.
To perform the calculation of the recoverable value of this investment, the ACS Group has used a valuation through the cash
fl ow discount method, according to the internal projections of the company for the 2011-2015 period, using the weighted
average cost of capital (WACC) of 8.93% as the discount rate and a perpetual growth rate of 2%. A sensitivity analysis has
likewise been performed, considering different discount rates, a perpetual growth rate and even deviations have been
considered up to 50% in the estimates of the company’s business plan. Both in the baseline and in the rest of the scenarios
considered, the recoverable value of this investment would in any case be above its book value. This conclusion is consistent
with the Xfera valuations published by analysts and by its controlling shareholder. Notwithstanding the above, considering
that Xfera is in the last stages of its launch phase, the Group has taken a conservative approach and not revaluated its
ownership interest to the estimated market value.
Other investments
Other investments include, inter alia, non-controlling interests held by the ACS Group in the company Accesos de Madrid
Concesionaria Española, S.A., and the collection rights on the future dividends of Sociedad Autovía de la Mancha, S.A., which
are recognised as an equity instrument since it is conceptually considered to better refl ect the true and fair image since it
corresponds to the future dividends of the shadow toll concession, for a maximum period of 30 years, which is guaranteed
by the fl ows generated by said Company.
The Group has assessed the recoverability of the assets recognised under this heading, by funding the corresponding
impairment based upon the recoverability analysis performed.
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ECONOMIC AND FINANCIAL REPORT
CONSOLIDATED FINANCIAL STATEMENTS