Marks and Spencer 2008 Annual Report Download - page 88

86 MARKS AND SPENCER GROUP PLC
Notes to the financial statements
continued
25 Acquisitions Marinopoulos
B.V. COMS a.s. Total
£m £m £m
Book values 9.2 2.6 11.8
Net assets at fair value (100%) 9.2 2.6 11.8
Net assets acquired 4.6 1.3 5.9
Cash consideration 38.1 10.6 48.7
Contingent consideration – 4.0 4.0
Transaction costs 0.8 0.8 1.6
Total consideration 38.9 15.4 54.3
Goodwill arising on acquisition 34.3 14.1 48.4
Marinopoulos B.V.
On 28 February 2008, the Group acquired Board control and 50% of the issued share capital of Marks and Spencer
Marinopoulos B.V. for cash consideration of €50.0m and transaction costs of £0.8m. The Marinopoulos group, located in
Greece, Bulgaria, Croatia, Romania, Switzerland and Serbia, was previously a franchise partner of the Group and is a retailer
of general merchandise and food. The fair values currently established for the acquisition are provisional due to the proximity
of the date of acquisition to the Group’s reporting date. The acquisition has contributed £4.8m to sales and a £0.4m loss to
operating profit in the period since the acquisition. If the acquisition of the Marinopoulos group had been completed on the first
day of the financial year, Group sales for the year would have been £9,052m and Group profits attributable to equity holders
of the Company would have been £824m.
COMS a.s.
On 20 March 2008, the Group acquired 51% of the issued share capital of COMS a.s. for cash consideration of €13.6m and
transaction costs of £0.8m. The COMS group, located in the Czech Republic, Latvia, Lithuania and Slovakia, was previously
a franchise partner of the Group and is a retailer of general merchandise and food. The fair values currently established for
the acquisition are provisional due to the proximity of the date of acquisition to the Group’s reporting date. The acquisition has
contributed £nil to sales and £nil to operating profit in the period since acquisition. If the acquisition of the COMS group had been
completed on the first day of the financial year, Group sales for the year would have been £9,034m and Group profits attributable
to equity holders of the Company would have been £822m. The sale and purchase agreement includes call and put options
over the remaining 49% of the share capital of COMS a.s. exercisable in five years time. The fair value of the put option (£52.2m)
has been recognised as a liability at 29 March 2008 (note 20 and note 27). On an undiscounted basis this liability has a value
of £81.0m.
Goodwill has arisen on the acquisitions of Marks and Spencer Marinopoulos B.V. and COMS a.s. due to the opportunities to
facilitate a faster rate of growth and greater operating efficiency that do not meet the criteria for recognition as an intangible
asset at the date of acquisition.
26 Share capital
2008 2007
Shares £m Shares £m
Authorised ordinary shares of 25p each 3,200,000,000 800.0 3,200,000,000 800.0
Allotted, called-up and fully paid ordinary shares of 25p each
At start of year 1,699,773,100 424.9 1,682,437,014 420.6
Shares issued on exercise of share options 12,447,224 3.1 17,336,086 4.3
Shares purchased in buy back (125,741,901) (31.4) ––
At end of year 1,586,478,423 396.6 1,699,773,100 424.9
Issue of new shares
12,447,224 (last year 17,336,086) ordinary shares having a nominal value of £3.1m (last year £4.3m) were allotted during the year
under the terms of the Company’s schemes which are described in note 12. The aggregate consideration received was £31.6m
(last year £44.9m).
Share buy back
125,741,901 (last year nil) ordinary shares having a nominal value of £31.4m (last year £nil) were bought back and subsequently
cancelled during the year in accordance with the authority granted by shareholders at the Annual General Meeting in July 2007.
The aggregate consideration paid was £555.9m (last year £nil).