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57
27. ASSET RETIREMENT OBLIGATIONS
The Group records asset retirement obligations in accordance with ASC No.410 “Asset Retirement and Environmental
Obligations” .
Asset retirement obligation was related primarily to the decommissioning of nuclear power facilities. These obligations
address the decommissioning, clean up and release for acceptable alternate use of such facilities.
The changes in the carrying amount of asset retirement obligations for the years ended March 31, 2011 and 2010 are as
follows:
Millions of yen
Thousands of
U.S. dollars
Year ended March 31 2011 2010 2011
Balance at beginning of year ¥ 29,642 ¥ 25,458 $ 357,133
Accretion expense 677 1,076 8,157
Liabilities settled (5,605) (1,419) (67,530)
Liabilities incurred 4,347 5,526 52,373
Foreign currency translation adjustments (2,423) (999) (29,193)
Balance at end of year ¥ 26,638 ¥ 29,642 $ 320,940
28. BUSINESS COMBINATIONS
On May 7, 2009, the Group acquired 52% of the outstanding shares of Nuclear Fuel Industries, Ltd. (“NFI”), from
Furukawa Electric Co., Ltd. and Sumitomo Electric Industries, Ltd. with the intention of expanding the Group’s Nuclear
Power Systems business by establishing a market presence in Japan and building a fuel production platform in Asia.
The Group allocated the purchase price to the assets acquired and liabilities assumed in accordance with ASC No.805
“Business Combinations” (“ASC No.805”). The total purchase price for the acquisition was ¥11,526 million in cash. Of the
total price, ¥13,680 million was allocated to property, plant and equipment, ¥10,070 million to noncontrolling interests,
¥8,054 million to amortizable intangible asset, ¥248 million to net liability assumed and ¥110 million to goodwill. The
acquired intangible assets primarily consisted of contracted customer relationships. The Group is amortizing the
intangible assets over a weighted-average estimated life of 16.5 years.
The operating results of NFI are included in the Company’s consolidated statements of income from May 2009
onward.
On April 30, 2009, the Group and Fujitsu concluded an agreement on the transfer of Fujitsu’s HDD business to
the Group. To effect the transfer, Fujitsu spun off its HDD business into a newly incorporated entity called Toshiba
Storage Device Corporation (“TSDC”), and on October 1, 2009, the Group acquired 80.1% of the shares of TSDC in
cash.
The Group expects to achieve great synergies from this acquisition by: (i) expanding market share in the comprehensive
area of data storage by leveraging its position as a leading vendor of small form factor HDDs and integrating Fujitsu’s
enterprise HDD business; and (ii) fulfilling a wide range of storage device demand by adding solid state drive products to
its product line, which will be newly developed by integrating its flash memory technology with Fujitsu’s enterprise HDD
technology.