Between HEINEKEN and the Seller certain indemnifications were agreed on, that primarily relate to tax and legal matters existing at the date of
acquisition. Our assessment of these contingencies indicates an indemnification receivable of EUR12 million that is considered an included element
of the business combination. The purchase price for the acquired businesses was based on an estimate of the net debt and working capital position
of the acquired businesses as at 11 January 2011 (the date of the completion of the acquisition). HEINEKEN and the Seller have determined the exact
net debt and working capital position of the acquired businesses as at 11 January 2011 by reference to agreed accounting principles and there will be
no adjustment to the final purchase price. Non-controlling interests are recognised based on their proportional interest in the net identifiable assets
acquired of Champion, Benue and Life for a total of EUR1 million.
In this year acquisition-related costs of EUR1 million have been recognised in the income statement.
Acquisition of two breweries in Ethiopia
On 11 August 2011, HEINEKEN announced that it had acquired from the government of the Federal Democratic Republic of Ethiopia ('Seller')
two breweries named Bedele and Harar (together referred to as the 'acquired business').
The acquired businesses contributed revenue of EUR13 million and results from operating activities of EUR1.5 million (EBIT) for the five-month period
from 4 August 2011 to 31 December 2011For the financial statements of HEINEKEN the additional 8 months would not have been material.
The following summarises the major classes of consideration transferred, and the recognised amounts of assets acquired and liabilities assumed
at the acquisition date.
In millions of EUR*
Property, plant equipment
Intangible assets 8
Trade and other receivables
Cash and cash equivalents
Deferred tax liabilities 8
Trade and other current liabilities
Total net identifiable assets
Net identifiable assets acquired
Goodwill on acquisition
Amounts were converted into euros at the rate of EUR/ETB 24,492 and EUR/USD 1.426 for the statement of financial position.
The purchase price accounting for the acquired business is prepared on a provisional basis. The outcome indicates goodwill of EUR88 million.
The derived goodwill includes synergies mainly related to market access and the available production capacity.
Goodwill has been allocated to Ethiopia in the Africa and Middle East region and is held in ETB. The rationale for the allocation is that the acquisition
provides access to the Ethiopian market: access to additional capacity, consolidate market share within a fast-growing market and improved profitability
through synergy. The entire amount of goodwill is not expected to be tax deductible.
Acquisition-related costs of EUR2.5 million have been recognised in the income statement for the period ended 31 December 2011.
Heineken N.V. Annual Report 2011