Business combinations

Business combinations in 2013

Payments totalling CHF 60 million were made in 2013 for the acquisition of Group companies. Of this amount, CHF 3 million relates to deferred consideration for business combinations in prior years and CHF 57 million for businesses acquired in 2013. The newly acquired companies in 2013 are viewed individually as non-significant business combinations and are thus reported on an aggregate basis.

In February 2013, Hospitality Services acquired the operating business of Deuromedia. Deuromedia provides IP-based infotainment solutions for the hospitality market.

At the end of March 2013, Datasport Ltd acquired the entire share capital of Abavent GmbH. Abavent GmbH is a German provider of sporting events. In April 2013, Swisscom IT Services acquired the business platform from Entris Banking and in doing so, the entire capital of Entris Integrator AG. Using the business platform of Entris Integrator AG, banks execute their banking activities such as the processing of payment transactions, credit and security settlements or e-banking. Following acquisition, the investee changed its name to Swisscom Banking Provider Ltd. In addition, in June 2013, Swisscom IT Services Ltd acquired the entire share capital of Entris Operations AG. Entris Operations AG processes primarily the cash and securities settlement operations for some 50 banks. Following acquisition, Entris Operations AG was merged into Swisscom Banking Provider Ltd.

Furthermore, Swisscom increased its shareholding in CT Cinetrade AG (Cinetrade) from 49% to 75% in April 2013. Cinetrade offers TV-related services, pay TV, transmissions of sporting events and video-on-demand. Cinetrade additionally operates one of leading cinema chains in Switzerland.

In December, Swisscom Switzerland acquired a 67% equity holding in DL-Groupe GMG AG, which provides services in the field of IP-based managed unified communication and collaboration.

The aggregate allocation of acquisition costs to the net assets may be analysed as follows:

In CHF million   2013
Cash and cash equivalents   55
Property, plant and equipment   32
Other intangible assets   66
Other current and non-current assets   43
Deferred tax liabilities   (15)
Other current and non-current liabilities   (84)
Identifiable assets and liabilities   97
Share of identifiable net assets attributable to non-controlling interests   (19)
Goodwill   159
Purchase consideration   237
Cash and cash equivalents acquired   (55)
Investments in associates. See Note 25.   (105)
Option from business combinations. See Note 33.   (20)
Cash outflow from business combinations of the current year   57
Cash outflow from business combinations of prior years   3
Total cash outflow from business combinations   60

The main reasons for the recognition of goodwill are the future anticipated synergies and additional market shares as well as the qualified workforce. In the 2013 consolidated financial statements, additional net revenues of CHF 172 million and net income of CHF 17 million were generated from these business combinations. Assuming that the subsidiary companies acquired in 2013 had been included in the consolidated financial statements as from 1 January 2013, there would have resulted consolidated pro-forma net revenues of CHF 11,529 million and a consolidated pro-forma net income of CHF 1,700 million.

Business combinations in 2012

Payments totalling CHF 17 million were made in 2012 for the acquisition of Group companies. Of this amount, CHF 5 million relates to deferred consideration for business combinations in prior years and CHF 12 million for businesses acquired in 2012. The newly acquired companies in 2012 are viewed each as non-significant business combinations and are thus reported on an aggregate basis.

On 1 March 2012, Swisscom Broadcast Ltd acquired the entire share capital of Datasport Ltd. Datasport Ltd is a service provider for popular and mass sporting events. On 26 June 2012, Swisscom Ltd acquired 100% of the capital of Treufida Treuhand & Beratungs GmbH. Treufida provides trustee, bookkeeping and advisory services for service providers in the field of healthcare. Following acquisition, Treufida changed its name to Curabill Treuhand GmbH. On 21 June 2012, Swisscom Directories Ltd purchased the entire share capital of localina Ltd. localina sells an iPad-based reservation system for restaurant and catering operations. Following acquisition, localina Ltd was merged with local.ch Ltd.

The aggregate allocation of acquisition costs to the net assets may be analysed as follows:

In CHF million   2012
Cash and cash equivalents   3
Property, plant and equipment   6
Other intangible assets   12
Deferred tax liabilities   (2)
Other current and non-current liabilities   (2)
Identifiable assets and liabilities   17
Goodwill   3
Purchase costs   20
Cash and cash equivalents acquired   (3)
Deferred payment of purchase price   (5)
Cash outflow from business combinations of the current year   12
Cash outflow from business combinations of prior years   5
Total cash outflow from business combinations   17

The main reasons for the recognition of goodwill are the additional market shares expected in future and the qualified workforce. In the 2012 consolidated financial statements, additional net revenues of CHF 8 million and a net income of CHF 3 million arose from these business combinations. Assuming that the subsidiary companies acquired in 2012 had been included in the consolidated financial statements as from 1 January 2012, there would have resulted consolidated pro-forma net revenues of CHF 11,385 million and a consolidated pro-forma net income of CHF 1,762 million.