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INTRODUCTION ABOUT US MANAGEMENT APPROACH
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2022
36. (a)
BUSINESS COMBINATIONS Acquisition of subsidiary
On October 27, 2021, the Group acquired the remaining 51% of Pre-Mixed Concrete Limited (“Premix”) and obtained control over the subsidiary. Premix is engaged in the manufacture of ready mixed concrete. This transaction qualifies as a business combination as defined in IFRS 3. Premix has been acquired by the Group to be in line with its vertical integration strategy.
The identifiable assets acquired and liabilities assumed at fair value at date of acquisition are as follows:
Assets
Property, plant and equipment
Fair value of brand name
Fair value of customer relationships Right of use assets
Intangible assets
Deferred tax assets
Inventories
Trade and other receivables Current tax assets
Cash and cash equivalents
Liabilities
Borrowings
Lease liabilities
Trade and other payables0 Retirement benefit obligations
Fair value of net assets acquired Consideration paid in cash
Fair value of previously held interests
Goodwill
Cash flow
Consideration paid
Less: Cash and cash equivalents acquired in subsidiary Net cash outflow on acquisition
Acquisition-related costs (included in administrative expenses) amount to Rs 4.3m.
October 27, 2021
Rs’000
164,157 60,838 20,627 87,999
1,749 14,308 13,504
165,147 2,483 12,182 542,994
14,277
95,714 187,932 26,106 324,029 218,965 285,416 274,235 559,651 340,686
Rs’000 285,416 (12,182) 273,234
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UBP INTEGRATED REPORT 2022
A goodwill of Rs 340.7m arose because the cost of acquisition included a control premium and was in line with the strategy disclosed above. None of the goodwill is expected to be deductible for income tax purposes.
Pre-Mixed Concrete Limited contributed Rs 416m to revenue and incurred a loss of Rs 18.7m for the period.
If the acquisition of Pre-Mixed Concrete Limited had been completed on the first day of the financial year, Group revenues for the year would have been Rs 4.224m and Group loss would have been Rs 33.5m.
