BT 2001 Annual Report Download - page 97

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16. Acquisitions and disposals (continued)
(i) During the year ended 31 March 1999, the acquisition of the interests in Concert Communications on 15 September 1998,
Martin Dawes Telecommunications (MDT) (renamed Lumina Limited) on 8 March 1999 and other subsidiary companies and the
consideration given comprised:
Concert
£m
MDT
£m
Other
£m
Total
£m
Minority interest 39 – 14 53
Fixed assets 34 1 35
Current assets 101 1 102
Current liabilities (152) (3) (155)
Long-term liabilities (3) – (3)
Group share of original book value of net assets (liabilities) 39 (20) 13 32
Fair value adjustment to achieve consistency of accounting policies – (9) – (9)
Fair value to the group 39 (29) 13 23
Goodwill 568 160 14 742
Total cost 607 131 27 765
Consideration:
Cash 607 41 19 667
Deferred ––88
Loan notes 1999/2006 –90 –90
Total 607 131 27 765
In September 1998, the group acquired MCI’s 24.9% interest in Concert Communications Company (Concert Communications)
for »607 million. Goodwill of »568 million arose on this transaction (refer below). This goodwill was transferred into the Concert
global venture with AT&T Corp on 5 January 2000.
MDT’s pro¢t after tax for the year to 31 December 1998 was »2 million. Goodwill arising on acquisition of MDT is being
written o¡ over 10 years.
Formation of principal joint venture
On 5 January 2000, the company and AT&T formed their global venture named Concert for the two companies’ trans-border
communications activities. The venture is jointly owned and controlled. The group contributed the majority of its cross-border
international networks, its international tra⁄c, its business with selected multinational customers and its international products
for business customers, as well as Concert Communications. AT&T contributed a similar set of assets and businesses.
The book value of the assets contributed by the group to the joint venture comprised:
£m
Intangible assets 568
Tangible fixed assets 870
Total fixed assets 1,438
Current assets 123
Current liabilities (183)
Net current assets (liabilities) (60)
Provisions for liabilities and charges (13)
Long-term debt owed to the BT group (1,169)
Net assets contributed 196
BT Annual report and Form 20-F 97