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18. Acquisitions and disposals continued
e
On 20 February 2001, the group took full control of Viag Interkom GmbH & Co (Viag Interkom). Under an
agreement announced in August 2000, the group purchased from E.ON its 45% interest in Viag Interkom by
means of a put option priced at e7.25 billion (£4,562 million). In January 2001, the group acquired the 10%
interest in the company previously owned by Telenor for e1.6 billion (£1,032 million). As part of the transactions,
the group repaid loans due by Viag Interkom to E.ON and Telenor totalling £3,165 million. The total cash
consideration amounted to £8,770 million, including £11 million expenses.
Book value and
fair value
£m
Fixed assets 6,728
Current assets 619
Current liabilities (585)
Long-term liabilities (2,505)
Group’s share of original book value of net assets 4,257
Goodwill 4,992
Total cost 9,249
Since the acquisition was made towards the end of the year ended 31 March 2001, the fair values of the
identifiable assets and liabilities were determined on a provisional basis which were then confirmed in the 2002
financial year. Goodwill arising on acquisition of Viag Interkom and remaining in the group was being amortised
over 20 years until it was partially demerged with mmO
2
and the remaining balance was written off in the 2002
financial year.
The consolidated results of Viag Interkom for the year ended 31 December 2000 and for the period from
1 January 2001 to 19 February 2001, on the basis of its accounting policies, are summarised as follows:
Period 1 January to
19 February 2001
£m
Year ended
31 December 2000
£m
Group turnover 216 856
Total operating loss (108) (686)
Loss before taxation (160) (784)
Loss for the financial period (160) (784)
f
Other subsidiary companies
During the year ended 31 March 2001, the acquisition of interests in other subsidiary companies and the
consideration given comprised:
Year ended 31 March 2001
Telfort
g
£m
Other
£m
Total
£m
Minority interest –3131
Fixed assets 496 – 496
Current assets 221 16 237
Current liabilities (261) – (261)
Group share of original book value of net assets and fair value to group 456 47 503
Goodwill 986 113 1,099
Total cost 1,442 160 1,602
g
On 22 June 2000, BT received regulatory approval to acquire the remaining 50% interest of Telfort BV,
its provider of fixed and mobile services to businesses and consumers in the Netherlands, that it did not already
own for £1,207 million. Goodwill arising on the acquisition of Telfort BV and remaining in the group was being
amortised over 20 years until it was partially demerged with mmO
2
and the remaining balance was written off
in the 2002 financial year. Telfort BV’s loss after tax for the year ended 31 December 1999 was £141 million
and its loss for the six months ended 30 June 2000 was £86 million.
h
On 5 January 2000, BT 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 traffic, 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.
Notes to the financial statements
BT Annual Report and Form 20-F 2003 101