Tiscali 2003 Annual Report Download - page 114

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Liberty Surf Group S.A. (EUR 518.9 million)
Liberty Surf Group S.A., a Company listed on the Paris stock market (Nouveau Marché) is the sub-holding Company for Group
activities in France, and represents one of its biggest investments. In the same way as with other holdings, the controlling stake
acquired in Liberty Surf in early 2001 was written down at the end of 2001, when a permanent loss of value was identified. Since
then, however, no other changes have taken place, and no reasons for further write-downs have arisen, taking into account the
trend in results recorded over the last two financial years and those set out in the Group’s business plan. The value of the hol-
ding, which includes a substantial amount of goodwill, was confirmed by the independent consultancy report that was used to pre-
pare this annual report.
Tiscali Business Service S.p.A. (EUR 1.3 million)
The entire share capital of Nextra S.p.A. was acquired in March 2003 from Norwegian companies Telenor Business Solution AS
and Telenor Business Solutions Holding AS, for approximately EUR 1.3 million, which was paid for in newly-issued shares in
Tiscali S.p.A. (643,950 shares) in July 2003. Nextra was later renamed Tiscali Business Service S.p.A..
Quinary S.p.A. (EUR 1.0 million)
The holding in Quinary, a systems integration and software development Company was written down by EUR 10.0 million in 2003.
The reason for the write-down was the poor business and financial position of the subsidiary in recent periods, which failed to
achieve a recovery in 2003. Quinary has also been undergoing a restructuring process aimed at redefining its role within the Tiscali
Group. The residual book value of the holding mainly consists of goodwill.
STS Studi Tecnologie e Sistemi S.r.l. (EUR 1.3 million)
During the year, 35% of STS was sold to other Group companies, including a 15% stake acquired by both GST Gilla Servizi
Telecomunicazioni S.r.l. and Andaledda S.p.A.. The total acquisition cost was EUR 1.9 million, corresponding to the book value
of the Company. However, the Group’s investment in this Company continues to be listed under holdings in subsidiaries. The book
value of STS largely consists of goodwill.
Tiscali Armement Sarl
During the year, Tiscali Armement, owner of a yacht used to promote the Tiscali Group, was sold to third parties for EUR 0.3 mil-
lion, generating a capital loss of EUR 0.6 million.
Tiscali Datacomm AG (EUR 17.0 million)
The Group’s controlling stake in this Swiss-based ISP (around 83% of the share capital; the rest is owned indirectly via World
Online International N.V.) was subject to a substantial write-down in 2003. The write-down was made in line with the findings of
the independent consultant’s report, in relation to operating assets owned by the Tiscali Group in several countries, and reflects
the current value of the Company, taking into account its business and financial prospects, as indicated by its business plan.
Tiscali Deutschland GmbH (EUR 36.4 million)
Tiscali Deutschland GmbH (which controls Tiscali GmbH) owns a substantial proportion of the Group’s operating assets in
Germany. As referred to above, the book value as of 31 December 2003 of this holding is recorded after the restatement of an
item for EUR 16.7 million that was previously included under provisions for risks and future liabilities. During the year, no other
changes were recorded in the value of this holding, which remained representative of its underlying assets, as confirmed by the
independent consultant’s report. The accounts of Tiscali Deutschland show a negative figure for shareholders’ equity (see table
below). This situation is expected to be resolved via operations under way to convert the share capital into credits in respect of
other Tiscali Group companies.