Mercedes 2003 Annual Report Download - page 133
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Please find page 133 of the 2003 Mercedes annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.In November 2003, as part of the Group’s ongoing strategy to
focus on its core automotive business, DaimlerChrysler sold a 60%
interest in Mercedes-Benz Lenkungen GmbH, its 100% interest
in Mercedes-Benz Lenkungen U.S. LLC and its 100% interest in
the steering activities of DaimlerChrysler do Brasil Ltda. to Thyssen-
Krupp Automotive AG (“ThyssenKrupp”) for €42 million in cash.
DaimlerChrysler’s remaining 40% interest in Mercedes-Benz
Lenkungen GmbH is subject to put and call options held by Daimler-
Chrysler and ThyssenKrupp, respectively, of approximately €28
million. The sales resulted in an aggregate pretax gain of €11 million
which is included in other income of the Commercial Vehicles
segment. DaimlerChrysler’s remaining 40% interest in Mercedes-
Benz Lenkungen GmbH is accounted for using the equity method.
The following assets and liabilities were part of this disposal group
in 2003: €30.3 million fixed assets, €114.9 million current assets,
€33.2 million liabilities and €63.2 million accrued liabilities.
In September 2003, as part of the Group’s ongoing strategy to
focus on its core automotive business, DaimlerChrysler sold its
50% interest in CTS Fahrzeug-Dachsysteme GmbH to Porsche AG
for €55 million in cash, resulting in a pretax gain of €50 million
which is included in financial income (expense), net, of the Mercedes
Car Group segment. Prior to the sale, DaimlerChrysler accounted
for CTS Fahrzeug-Dachsysteme GmbH using the cost method.
On January 6, 2003, MMC spun off its “Fuso Truck and Bus”
division, creating Mitsubishi Fuso Truck and Bus Corporation
(“MFTBC”). On March 14, 2003, as part of the Group’s global
commercial vehicle strategy, DaimlerChrysler acquired from MMC
a 43% non-controlling interest in MFTBC. The final purchase price
was €764 million in cash. Also, on March 14, 2003, ten Mitsubishi
Group companies, including Mitsubishi Corporation, Mitsubishi
Heavy Industries and Bank of Tokyo-Mitsubishi, entered into a
separate share sale and purchase agreement with MMC pursuant
to which they purchased from MMC 15% of MFTBC’s shares for
approximately €266 million in cash. As a result of these transactions,
MMC now retains a 42% non-controlling interest in MFTBC.
DaimlerChrysler allocated €34 million of the total purchase price of
its 43% interest in MFTBC to investor-level goodwill (see Note 12).
In addition, €36 million of the purchase price of the Group’s invest-
ment in MMC, which was allocated to MFTBC’s business during
initial equity method accounting of MMC in 2000 and 2001, was
allocated to the investment in MFTBC of the Commercial Vehicle
segment. DaimlerChrysler accounts for its investment in MFTBC
using the equity method (see Note 3). The Group’s proportionate
share of MFTBC’s results are included in the Group’s Commercial
Vehicles segment. As described in Note 38, on January 15, 2004,
DaimlerChrysler entered into a purchase agreement with MMC to
acquire an additional 22% equity interest in MFTBC at an expected
purchase price of approximately €0.4 billion in cash. This transac-
tion is dependant on the approval of the individual governmental
and antitrust authorities of the countries concerned. The Group
expects the transaction to be consummated in March 2004 and to
consolidate MFTBC in the second quarter of 2004.
During 2003, in separate transactions, the Group acquired 11
(2002: 18) dealerships in Europe, none of which were material.
The aggregate purchase price paid in these separate acquisitions
amounted to €56 million (2002: €86 million) and resulted in
additions to goodwill of approximately €26 million (2002: €61
million).
In the fourth quarter of 2002, as part of the Group’s ongoing
strategy to focus on its core automotive business, DaimlerChrysler
entered into an agreement to sell a 51% controlling interest in
VM Motori S.p.A. and its 100% ownership interest in Detroit Diesel
Motores do Brasil Ltda., both wholly-owned subsidiaries of
DaimlerChrysler. The transactions were completed by the fourth
quarter of 2003. Based on the agreed purchase price of €26
million, DaimlerChrysler recorded an impairment charge in 2002
for long-lived assets and goodwill related to the disposal groups
and long-lived assets and goodwill to be retained. The total asset
impairment and goodwill impairment charges recognized in 2002
were €1 million and €40 million, respectively, which are included in
other expenses of the Commercial Vehicles segment (see also
Note 5). The following assets and liabilities were classified as
held-for-sale as of December 31, 2002: fixed assets of €74 million,
current assets of €48 million, liabilities of €95 million, and accrued
liabilities of €7 million. DaimlerChrysler accounts for its remaining
49% interest in VM Motori S.p.A. using the equity method.
In January 2002, DaimlerChrysler exercised its option to sell to
Deutsche Telekom the Group’s 49.9% interest in T-Systems ITS,
which had been accounted for using the equity method, for €4,694
million in cash. The sale, which was part of DaimlerChrysler’s
ongoing strategy to focus on its core automotive business, was
consummated in March 2002 with the termination of the
information technology joint venture, resulting in a pretax gain
of €2,484 million that is included in the financial income of
the Services segment.
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