On 12 November 2014, the Group acquired 100% of the issued share capital of Aesica Holdco Limited, obtaining control of Aesica Holdco Limited ("Aesica"). The goodwill balance as at 30 April 2016 in relation to Aesica is £106.8m (FY2015 restated: £101.9m).
During the year ended 30 April 2016, the Group completed the initial accounting for the acquisition as disclosed in the 30 April 2015 annual report and accounts. Therefore, as set out in the table below, the 30 April 2015 comparative information has been adjusted retrospectively to amend the provisional fair values of the identifiable assets acquired and liabilities assumed as at the date of acquisition.
The fair values of the identifiable assets acquired and liabilities assumed as at the date of acquisition were as set out in the table below:
|Property, plant and equipment||71,312||(5,713)||65,599|
|Cash and cash equivalents||6,221||–||6,221|
|Identified intangible assets||82,299||–||82,299|
|Other intangible assets||410||–||410|
|Total identified assets||225,794||(8,576)||217,218|
|Trade and other payables||(24,377)||–||(24,377)|
|Accruals, deferred income, provisions and other liabilities||(46,079)||(1,022)||(47,101)|
|Deferred tax liability||(29,812)||4,029||(25,783)|
|Total identified liabilities||(100,268)||3,007||(97,261)|
|Net identified assets||125,526||(5,569)||119,957|
As disclosed in the prior year accounts, total consideration consists of cash, equity and contingent consideration.
The significant adjustments to fair values made in the year are as follows:
- Property, plant and equipment — decrease of £5.7m as a result of concluding a detailed review and valuation exercise
- Trade receivables — decrease of £1.3m to increase provisions against old debtor balances and credit notes
- Accruals, deferred income and provisions and other payables — decrease of £1.0m mainly as a result of new information obtained which reflects circumstances in existence at the acquisition date
- Current tax — decrease of £1.6m to record additional provisions
- Deferred tax — increase of £2.1m on the non-tax related opening balance sheet adjustments above
- Deferred tax — since 31 October 2015, a deferred tax asset of £1.9m has been recognised as the amount of spend treated as qualifying for capital allowances has been reduced by customer contributions in Aesica which were received pre-acquisition. The impact of this change has been to decrease goodwill by the same amount. The directors have not restated the income statement for the year ended 30 April 2015 for the effect of this restatement as it was not material.
In the prior year, Aesica entered into an option agreement with a third party to purchase a parcel of land which it then owned for consideration of £1.9m. During the current year, this option was exercised and the Group was required to pay the proceeds of £1.6m as consideration. This was recognised as contingent consideration on acquisition in the prior year.