Pharmaceuticals Sector - Solvay

Solvay Group purchased 100% of the capital of Italmex S.A., which manufactures and sells pharmaceuticals in
Mexico, for a net cash outlay of EUR 24 million. Another EUR 8 million was paid onto an escrow account, to be
released to the former Italmex shareholders if certain conditions are fulfi lled. At December 2005, agreement was
reached with the former owners to reduce this amount to EUR 7 million. At the end of 2005, no payment had yet
been made from the escrow account.
The net assets acquired in the transaction and the resulting goodwill are:
EUR million Total
Tangible assets 6
Other investments 1
Non-current assets 7
Current assets other than cash and cash equivalents 6
Cash and cash equivalents 2
Current assets 8
Current fi abilities 14
Net assets 1
Goodwill 25
Total consideration paid 26
Bank balances and cash acquired -2
Net cash outlay an acquisition 24
Italmex contributed EUR 22 million of sales and EUR 6 million of EBIT between January 1 and December 31, 2005.
(27) Inventories
EUR million at December 31 2004 2005
Finished goods 571 646
Raw materials and supplies 418 441
Work in progress 79 99
Other inventories 17 5
Total 1 085 1 191
Write-downs -28 -29
Net total 1 057 1 162
(28) Trade receivables
As in 2004, trade receivables represented 68 days’ sales. The carrying value of the trade receivables is a good
approximation of the fair value at balance sheet closing date.
There is no signifi cant concentration of credit risk at Group level to the extent that the receivables risk is spread over
a large number of customers and markets.
Solvay Global Annual Report 2005
81