3 Changes in the scope of consolidation
Acquisitions in 2021
On 1 March 2021, SoftwareONE acquired 100% of VB Technology Group AG, Switzerland (‘ITPC’), with subsidiaries in Switzerland and India. ITPC is an SAP specialist for S/4HANA transformations, public cloud migrations and related managed services offerings, including monitoring, maintenance and support. Continuing the series of quality SAP cloud acquisitions, ITPC further expands and strengthens the group’s SAP capabilities, underpinning its strategic importance.
On 29 April 2021, the group acquired a controlling shareholding of 70% in SynchroNet Corp. (‘SynchroNet’), an AWS-focused cloud specialist in digital workplace solutions. The acquisition expands SoftwareONE’s capabilities in the fast-growing market of cloud-based services for remote working and complements its global AWS services portfolio. SoftwareONE has applied the partial goodwill method. Due to an equity of zero, no minorities were taken into account at the time of initial consolidation.
The provisional fair values of the identifiable assets and liabilities as at the date of acquisition were:
|
in CHF 1,000 |
Total |
|
|
|
|
Cash and cash equivalents |
469 |
|
Trade receivables |
1,447 |
|
Other current assets |
235 |
|
Tangible assets |
114 |
|
Intangible assets (excluding goodwill) |
15 |
|
Right-of-use assets |
815 |
|
Deferred tax assets |
113 |
|
Other non-current assets |
27 |
|
|
|
|
Total assets |
3,235 |
|
|
|
|
Trade payables |
314 |
|
Other current liabilities |
458 |
|
Accrued expenses and contract liabilities |
834 |
|
Defined benefit liabilities |
480 |
|
Financial liabilities |
1,015 |
|
|
|
|
Net assets acquired at fair value |
134 |
Details of the purchase considerations recognized at acquisition and the derivation of goodwill are as follows:
|
in CHF 1,000 |
Total |
|
|
|
|
Cash paid |
15,105 |
|
|
|
|
Total purchase consideration |
15,105 |
|
Less net assets acquired at fair value |
134 |
|
|
|
|
Goodwill |
14,971 |
The purchase price paid for the acquisition of ITPC and SynchroNet mainly relates to the skilled workforce and, therefore, represents goodwill.
From the date of acquisition, the acquired companies contributed TCHF 1,642 to revenue and TCHF-499 to the profit for the year.
If all acquisitions had taken place at the beginning of the year, total revenue of SoftwareONE group would have been TCHF 4,368,015 and the net profit for the period would have been TCHF 35,889 as at 30 June 2021.
Acquisitions in 2020
On 9 November 2020, SoftwareONE exercised a call option to acquire the remaining 60% and obtained control of IG Services SAS, Colombia (‘InterGrupo’), following its initial investment of 40% in 2019. During the period to 30 June 2021, the group adjusted the purchase accounting. An additional contingent liability was considered in an amount of TCHF 1,593 of which TCHF 1,245 is covered by an indemnity. This led to an increase in goodwill of TCHF 348 to TCHF 17,091. As the audited consolidated financial statements of InterGrupo for the last financial year were not yet available at the time the interim condensed consolidated financial statements were prepared, a subsequent purchase price adjustment is expected. Therefore, the purchase price allocation of InterGrupo is still provisional.
On 31 December 2020, SoftwareONE acquired 100% of Intelligence Partner SL, Spain (‘Intelligence Partner’), a leading Google cloud services company with subsidiaries in Brazil and Dubai. As the audited financial statements of Intelligence Partner for the last financial year were not yet available at the time the interim condensed consolidated financial statements were prepared, a subsequent purchase price adjustment is expected. Therefore, the purchase price allocation of Intelligence Partner is still provisional.
On 20 May 2020, the group acquired 100% of GorillaStack Pty Ltd., an Australian-based provider of cloud cost management and real-time event monitoring software as a service (SaaS) platform for Amazon Web Services (AWS). On 10 July 2020, SoftwareONE acquired 100% of B-Lay B.V., Netherlands (‘B-Lay’), a leading provider of Software Asset Management (SAM) advisory and managed services for SAP and Oracle solutions with subsidiaries in the US and Romania. On 30 December 2020, the group acquired the activities and assets of Optimum Consulting LLC, US (‘Optimum’), an SAP-certified technology consulting company, by way of an asset deal. During the period to 30 June 2021, the group finalized the purchase accounting and there were no changes in the final fair values of acquired assets and liabilities compared to the provisional amounts disclosed in the Annual Report 2020.
Cash flows on acquisitions
|
in CHF 1,000 |
Total |
|
|
|
|
Cash consideration |
–15,105 |
|
Net cash acquired |
469 |
|
Cash consideration for current period acquisitions |
–14,636 |
|
Cash consideration for prior period acquisitions |
–20,142 |
|
|
|
|
Net outflow of cash – investing activities |
–34,778 |
In January 2021, the purchase price for the acquisition of the remaining 60% of the shares of InterGrupo (TCHF 20,142) was paid.
Reconciliation of carrying amount of goodwill
The change in carrying values for goodwill from 1 January 2021 to 30 June 2021 are set forth below:
|
in CHF 1,000 |
2021 |
|
At 1 January |
358,361 |
|
Business acquisitions |
14,971 |
|
Additions due to subsequent purchase price allocation adjustment |
348 |
|
Currency translation adjustments |
6,703 |
|
|
|
|
As at 30 June |
380,383 |