F6. Acquisitions and disposals

Acquisitions

With the exception of the acquisition of Nampak, which is described in more detail below, SCA made only minor supplementary investments in 2015 and paid the final purchase consideration for previously acquired companies. In July, SCA signed an agreement to acquire the remaining 50% of the jointly owned South African subsidiary Sancella S.A. Nampak. The purchase consideration amounted to SEK 1. SCA had already recognized Sancella S.A. as a subsidiary, which is why the acquisition will be recognized as a so-called equity transaction.

The acquisitions conducted during the period, which amounted to SEK 74m, were paid in cash. The earn-out payment for FZCO Sancella amounted to SEK 19m, of which SEK 11m was paid in cash and the remaining SEK 8m was recognized as a financial liability. Operating profit for the period includes acquisition costs of approximately SEK 1.4m.

Effect on sales and earnings of acquisitions for the period

No new acquisitions were carried out during the period.

Acquired operations

The table below shows the fair value of acquired net assets recognized on the acquisition date, recognized goodwill and the effect on the Group’s cash flow statements.

Adjustment of preliminary acquisition balance sheets for 2014

An acquisition analysis is considered preliminary until it is confirmed. A preliminary acquisition analysis is confirmed as soon as new information regarding assets/liabilities on the acquisition date is obtained, but not later than one year from the time of acquisition. Adjustments to acquisition analyses result in changes to the income statement and balance sheet for the comparative period. The acquisition analyses prepared in the preceding year have been confirmed in accordance with the preliminary acquisition analyses.

Acquisitions after the end of the reporting period

On October 13, 2015, SCA announced that it had made a public bid on Wausau Paper Corp., one of the largest AfH tissue companies in the North American market. The purchase consideration amounted to USD 513m in cash. The transaction was conditional on the approval of Wausau Papers shareholders and the relevant authorities. The transaction was approved by the US competition authority on November 17, 2015, and Wausau Paper’s shareholders accepted the bid from SCA at the shareholder meeting held on January 20, 2016. SCA recently gained access to financial information from Wausau and the preliminary acquisition analysis is based on the balance sheet prepared by Wausau in accordance with generally accepted accounting principles in the US (US GAAP). Non current assets have not yet been calculated and no new actuary calculation of the pensions has been made. Intangible assets and goodwill is only estimated preliminary. Goodwill is motivated by synergies between SCA and Wausau in the area of AfH tissue in North America. To finance the aquisition of Wausau, SCA took up a loan of USD 500m.

In October, SCA signed an agreement to divest its operations in Southeast Asia, Taiwan and South Korea for integration with Vinda International Holding Limited (Vinda), a subsidiary that is 51.4% owned by SCA and listed on the Hong Kong stock exchange.

Divestments

In July 2015, SCA and Nampak signed an agreement to divest the baby diaper operations of the jointly owned South African company Sancella S.A. to another South African company. The transaction was completed in the fourth quarter and resulted in a transferred consideration of SEK 116m and near-zero profit. Of this transferred consideration, SEK 67m will be paid in 2016.

In addition, final settlement of the earn-out payment took place for the publication paper mill in Laakirchen, Austria, which was divested in 2013. The transaction resulted in an accounting gain of SEK 92m, which was recognized in items affecting comparability in profit or loss.