Unilever 2007 Annual Report Download - page 115

Unilever Annual Report and Accounts 2007 113
Financial statements continued
Notes to the consolidated accounts Unilever Group
26 Acquisitions and disposals
2007
During 2007 we purchased minority interests in subsidiary companies in Greece and India. We invested in a new venture fund, Physic Ventures,
which is accounted for as an associate, and made additional investments in two other venture companies, Spa and Salon International Limited
and Langholm Capital, both of which are accounted for as associates.
With effect from 1 October 2007, Unilever and Remgro Ltd. reached agreement to reorganise their respective shareholdings in the Unilever
businesses in South Africa and Israel. In the reorganised shareholding Unilever has a majority share in a single South African business and fully
owns the Unilever Israel foods and home and personal care business. As a result of this transaction, Unilever has reported a profit on disposal of
€214 million and goodwill of €168 million.
On 1 January 2007, Unilever completed the restructuring of its Portuguese businesses. The result of the reorganisation is that Unilever now has
a 55% share of the combined Portuguese entity, called Unilever Jerónimo Martins. The combined business includes the foods and home and
personal care businesses. The remaining 45% interest is held by Jerónimo Martins Group. The structure of the agreement is such that there is
joint control of the newly formed entity and so it is accounted for by Unilever as a joint venture.
Other disposals in 2007 included the sale of local Brazilian margarine brands. In addition, to further develop our healthy heart brand margarine,
Becel, in Brazil we have established a joint venture with Perdigão. During 2007, we have also announced the disposal of Boursin to Le Groupe
Bel for €400 million, and the disposal of Lawry’s and Adolph’s seasoning blends and marinades business to McCormick and Company for
US $605 million. Both will be effective during 2008. See note 33 on page 121 for further details. Furthermore, we announced plans to dispose
of our North American laundry business, the process for which is ongoing.
2006
During 2006 we purchased minority interests in subsidiary companies in Greece and Algeria, trademarks in Czech Republic, distribution in
Tunisia and Vashisti business in India. Also an additional investment into Langholm Capital Partners Fund was made and classified as an
acquisition of associates (see note 11 on page 90).
On 3 November 2006, Unilever announced that it had reached a final agreement with Permira Funds to sell the majority of its European frozen
foods business for €1.7 billion. The Unilever businesses being sold in this transaction include the frozen foods operations in Austria, Belgium,
France, Germany, Ireland, Netherlands, Portugal and the United Kingdom.
Other disposals in 2006 were Mora in the Netherlands and Belgium, Finesse in the US, Canada and Sweden, Friol in Italy and Nihar and
tea plantations in India.
2005
The principal disposals in 2005 were Unilever Cosmetics International across the world, Stanton Oil in the UK and Ireland, Dextro in various
countries in Europe, Opal in Peru, Karo and Knax in Mexico, spreads and cooking products in Australia and New Zealand, Crispa, Mentadent,
Marmite, Bovril and Maizena in South Africa, frozen pizza in Austria, Biopon in Hungary and tea plantations in India.
In March 2005 Unilever restructured its Portuguese foods business. Before the restructuring Unilever Portugal held an interest in FIMA/VG –
Distribuição de Produtos Alimentares, Lda. (FIMA) foods business, a joint venture with Jerónimo Martins Group, in addition to its wholly owned
Bestfoods business acquired in 2000. As a result of the transaction the two foods businesses – FIMA and Unilever Bestfoods Portugal – were
unified and the joint venture stakes were re-balanced so that Unilever holds 49% of the combined foods business and Jerónimo Martins Group
51%. During 2006, Unilever signed an agreement with Jerónimo Martins to restructure the ownership of the Portuguese operations effective 1
January 2007.
€ million € million € million
Disposals 2007 2006 2005
Goodwill and intangible assets 51150
Other non-current assets 44 242 78
Current assets 117 354 207
Trade creditors and other payables (48) (157) (106)
Provisions for liabilities and charges (34) (91) (15)
Minority interest 71 –(1)
Net assets sold 155 349 313
(Gain)/loss on recycling of currency retranslation on disposal (1) –(5)
Profit on sale attributable to Unilever 399 1 528 655
Consideration(a) 553 1 877 963
Cash 168 1 870 845
Cash balances of businesses sold (4) – (17)
Financial assets, cash deposits and financial liabilities of businesses sold 113 (5) 8
Non-cash items and deferred consideration(a) 276 12 26
Payment received in prior year ––101
(a) For 2007, includes €214 million fair value economic swap in South Africa.
The results of disposed businesses are included in the consolidated accounts up to their date of disposal.