Carphone Warehouse 2007 Annual Report Download - page 59

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www.cpwplc.com
14 Non-current asset investments continued
ii) Alto Hiway
On 30 September 2006, the Group acquired 100% of the issued share capital of Hicom Internet Limited and its wholly owned subsidiary, Alto Hiway Limited
(together Alto Hiway), both companies being registered in England and Wales, for an upfront gross cash consideration of £5.4m and deferred consideration of
£2.0m which is contingent on future performance and payable over 3 years. Alto Hiway is a business internet service provider.
The following table sets out the book values of the identifiable assets and liabilities acquired and their provisional fair value to the Group:
Book Fair value Fair value
value adjustments to the Group
£’000 £’000 £’000
Non-current assets
Acquisition intangibles – 2,690 2,690
Property, plant and equipment 261 – 261
Current assets
Stock 19 – 19
Trade and other receivables 1,588 – 1,588
Cash and cash equivalents 1,456 – 1,456
Total assets 3,324 2,690 6,014
Current liabilities
Trade and other payables (4,600) – (4,600)
Non-current liabilities
Deferred tax liabilities – (808) (808)
Total liabilities (4,600) (808) (5,408)
Total assets and liabilities (1,276) 1,882 606
Provisional goodwill 6,787
7,393
Satisfied by
Cash 5,393
Deferred consideration 2,000
7,393
Net cash outflows in respect of the acquisition comprised:
£’000
Gross cash consideration 5,393
Cash acquired (1,456)
3,937
Fair value adjustments relate principally to the recognition of acquisition intangibles, being a customer base with a value of £2.7m, and the recognition of deferred
tax thereon.
The Group’s results for the period reflect revenue from Alto Hiway of £3.9m and a loss before taxation of £1.0m.
55
Financial Statements