Volvo 1998 Annual Report Download - page 60

58
NOTE S
Parent Company holdings of shares in subsidiaries as of
December 31, 1998 are shown on page 89. Significant
acquisitions, formations and divestments within the
Group are shown below.
Mexicana de Autobuses SA de CV
In October 1998 AB Volvo acquired all of the shares of
Mexicana de Autobuses (MASA), a Mexican bus manu-
facturer. At the same time it was announced that Henlys
Group, Volvo’s partner in US bus operations, will acquire
a 35% minority interest at a later date. MASA is Mexico’s
second-largest producer of coaches and inter-city buses.
Goodwill amounting to SEK 0.6 billion, which is being
amortized over 20 years, arose in connection with the
acquisition.
Euclid Hitachi Heavy Equipment Inc
In October 1998 Volvo Construction Equipment concluded
an agreement with Hitachi Construction Machinery Ltd.
to reduce Volvo’s holding in Euclid Hitachi Heavy Equip-
ment, a jointly owned company, from 60% to 20%. The
sale of shares had only a marginal impact on reported
profit of the Volvo Group for 1998.
Kopsch AG
In September 1998 Volvo Construction Equipment ac-
quired Kopsch AG, its largest dealer in Germany, which
has a network of ten sales locations.
Volvo Otomotiv Türk Ltd Sti (Trakmas)
In September 1998 Volvo Construction Equipment took
over its import operations in Turkey, including four sales
locations, from Trakmas. Volvo’s operations in the Turkish
market were then coordinated within Volvo Otomotiv
Türk, a wholly owned subsidiary.
Volvo Construction Equipment Korea Co Ltd
In July 1998 Volvo Construction Equipment acquired all
the assets of Samsung Heavy Industries’ construction
equipment business for preliminary USD 0.5 billion. The
assets were acquired mainly through a newly formed
subsidiary, Volvo Construction Equipment Korea. The
acquired business includes the development, production
and marketing of excavators in the 7-to-28-ton categories,
as well as wheel loaders and other equipment on a
smaller scale. The acquisition also includes a comprehen-
sive distribution network in the South Korean market.
Goodwill amounting to SEK 1.2 billion, which is being
amortized over 20 years, arose in connection with the
acquisition.
ZAO Volvo Vostok
In June 1998, a new company, ZAO Volvo Vostok, was
established in Russia, in which each business area con-
ducts its operations.
Nova BUS Corporation
In February 1998 Volvo Bus Corporation acquired Nova
BUS, a North American bus manufacturer, for slightly
more than CAD 50 million. The acquisition was effected
via Prévost Car Incorporated, in which Volvo Bus
Corporation since 1995 has had a 51% interest, and
Henlys Group, a British company, 49%. Nova BUS is a
leading producer of city buses in the United States and
Canada, with production plants in both countries. Goodwill
amounting to SEK 0.3 billion, which is being amortized
over 20 years, arose in connection with the acquisition.
BRS Ltd
In February 1998 Volvo Contract Services, Volvo Trucks’
sales financing company in Great Britain, acquired BRS
Truck Rental and Contract Hire, a British truck leasing
company, for a total of approximately GBP 49 million.
BRS, with representation throughout Great Britain, is a
well-established brand name in the field of British truck
leasing.
Carrus Oy
In January 1998 Volvo Bus Corporation acquired all the
shares of Carrus Oy, a Finnish producer of bus bodies at
a purchase price of SEK 0.5 billion. The company manu-
factures five different body models for city- and inter-city
buses as well as coaches used on bus chassis of various
vehicle producers. Goodwill amounting to SEK 0,2 billion,
which is being amortized over 10 years, arose in connec-
tion with the acquisition.
Volvo Trucks North America, Inc
(former Volvo GM Heavy Truck Corporation)
In July 1997 Volvo Truck Corporation took over the
remaining 13% of the common shares of its North
American truck company from General Motors Corporation
and changed the name of the company to Volvo Trucks
North America, Inc. The reason for the change was to
gain full control of the company. General Motors received
preferred shares in exchange for its common shares.
Transbanco Banco de Investimento SA
In December 1997 Volvo do Brasil acquired the remaining
outstanding 50% of the shares of the Brazilian sales-
financing company, Transbanco Banco de Investimento
SA. As of December 31, 1997, the company’s balance
sheet was consolidated in the Volvo Group accounts.
The holding was earlier reported in accordance with the
equity method.
Champion Road Machinery Limited
In March 1997 Volvo Construction Equipment acquired
all of the shares of the Canadian company, Champion
Road Machinery Limited, for CAD 173 million. The com-
pany is a large manufacturer of graders and other ma-
chines used in road construction and maintenance.
Champion was consolidated as of January 1, 1997.
Goodwill amounting to SEK 0.7 billion, which is being
amortized over 20 years, arose in connection with the
acquisition.
Volvo Penta Benelux BV
During 1997 AB Volvo Penta acquired Nebim Handels-
maatschappij BV, an independent importer in the Nether-
lands. The name of the company was then changed to
Volvo Penta Benelux BV. The company is responsible for
the marketing, sales and service of industrial and marine
engines in Belgium, the Netherlands and Luxembourg.
The AGES Group, ALP
In 1996 Volvo Aero increased its ownership of the
American company, The AGES Group, ALP (Air Ground
Equipment Sales) from 5% to 25%. Early in 1997 the
holding was further increased to 60% and AGES there-
after became a subsidiary of Volvo. Goodwill amounting
Acquisitions and divestments of shares in subsidiaries Note 2