Note 4 Operations acquired during 2008

               
Gymgrossisten              
The Group declared an unconditional offer for Gymgrossisten Nordic AB on 23 January 2008. Gymgrossisten is a leading online supplier of nutritional supplements. MTG controlled 99.42% of the shares on 8 February 2008 and initiated a mandatory tender for the remaining issued and outstanding shares. As per 24 November, MTG was in control of 100% of the shares. The results is reported within the Online business area with effect from 1 February 2008. The total consideration was SEK 198 million including transaction costs of SEK 2 million.The acquisition gave rise to separately identified immaterial rights of SEK 55 million and goodwill of SEK 89 million.
The goodwill acquired in 2008 comprise of strategic benefits, market position and synergy effects.
 
Net assets acquired (SEK million):         Book value Fair value adjustment Recognised values
Property, plant and equipment         5   5
Intangible assets         52 55 107
Inventories         26   26
Trade and other receivables         7   7
Cash and cash equivalents         7   7
Deferred tax receivables         1   1
Deferred tax liabilities         - -15 -15
Trade and other payables         -29   -29
Net identifiable assets and liabilities         68 40 108
               
Goodwill on acquisition             89
Total consideration             198
               
Liquid funds in acquired companies             -7
Net cash outflow             192
               
Nova Televizia, Bulgaria              
On 16 October 2008, the Group acquired 100% of the shares in Nova Televizia for a total cash consideration of EUR 620 million and transaction costs of EUR 4.5 million. The Nova commercial TV channel is the second largest free-TV channel in Bulgaria, and is broadcast under a national terrestrial free-TV license, as well as on cable and satellite networks. The acquisitions gave preliminary rise to goodwill of SEK 5,321 million, and separately identified intangible assets of SEK net 581 million. Nova is reported within Viasat Broadcasting business area with effect from 16 October 2008.
The goodwill acquired in 2008 comprise of strategic benefits, synergy effects and geographical presence.
Net assets acquired (SEK million):         Book value Fair value adjustment Recognised values
Property, plant and equipment         103   103
Broadcasting license         - 153 153
Trademarks         27 493 519
Intangible assets         0   0
Inventories         64   64
Trade and other receivables         88   88
Cash and cash equivalents         18   18
Interest-bearing loans and borrowings         -9   -9
Provisions         -1   -1
Deferred tax liabilities         - -65 -65
Trade and other payables         -148   -148
Net identifiable assets and liabilities         142 581 723
               
Goodwill on acquisition             5,321
Total cash consideration             6,044
               
Liquid funds in acquired companies             -18
Net cash outflow             6,026
               
               
Other acquisitions during the year              
Other acquisitions during the year comprise the 50% joint venture Viastrong Holding AB, owner of the Ukrainian companies entailing the DTH satellite pay-TV platform. The DTH platform was launched on 21 April 2008. The purchase price was SEK 44 million and gave rise to a goodwill of SEK 31 million. An acqusition was made of GENUS TV in the Czech Republic, a regional terrestrial broadcasting licence. Additional purchase prices were paid for ERA TV, the Macedonian channel within Balkan Media Group. The acquisitions are reported within the Viasat Broadcasting business area.
Additional purchase prices were paid for Playahead AB, NLY Scandinavia AB, and Helsingin Dataclub OY during 2008 in accordance with the acquisition agreements. These acquisitions are reported within the Online business area.
In addition, acquisitions of part of the minority in MTG Russia AB and payment of the acquisition of Altlorenscheurhof S.A. from last year have been made during the year.
Net assets acquired (SEK million):           2008 2007
Net identifiable assets and liabilitites acquired           13 9
Additional consideration from previous years, paid out           184 -1
Goodwill on acquisition           52 39
Total cash consideration           249 47
               
Summary (SEK million):         Net cash outflow Net identifiable assets and liabilitites acquired Goodwill
Gymgrossisten         192 108 89
Nova, Bulgaria         6,026 723 5,321
Other acquisitions         249 13 52
Total         6,466 844 5,462
               
  2008   2007
Summary (SEK million): Book value Fair value adjustment Total   Book value Fair value adjustment Total
Tangible assets 109   109   13   13
Intangible assets 79 700 780   5 41 46
Other long-term assets -   -   1   1
Inventories 90   90        
Trade and other receivables 109   109   59   59
Cash and cash equivalents 25   25   15   15
Deferred tax liability 0 -80 -80     -10 -10
Interest-bearing loans -9   -9   -25   -25
Provisions -1   -1       -
Trade and other payables -179   -179   -49   -49
Net identifiable assets and liabilities 223 621 844   18 31 49
               
Goodwill     5,462       223
Minority interest     -       -7
Purchase price     6,306       265
               
Additional consideration from previous years, paid out     184       -
Additional consideration not paid out     -       -32
Liquid funds in acquired companies     -25       -15
Net cash flow     6,466       219
               
Contributions during 2008 from the acquired companies by business area:
From the acquisition date (SEK million):         Viasat Broadcasting Online Group
Net sales         120 145 265
Operating income         -16 16 -1
Net profit         -20 7 -13
               
If the acquisition had occurred on 1 January (SEK million)         Viasat Broadcasting Online Group
Net sales         506 157 664
Operating income         74 20 94
Net profit         60 10 70
               

Modern Times Group MTG AB Box 2094 SE-103 13 Stockholm Sweden Visiting: Skeppsbron 18 Tel: +46 8 562 000 50