Note 2: Scope of consolidation
Material subsidiaries
The Consolidated financial statements comprise the assets, liabilities, income and expenses of 283 legal entities. We consider legal entities material when they represent, for at least two subsequent years, more than 5% of either revenue or adjusted operating income or based on qualitative aspects. Material subsidiaries included in the table in this Note are fully owned at year-end 2020.
Legal entity |
Principal place of business/ |
|---|---|
Akzo Nobel Coatings Inc. |
US |
Akzo Nobel Paints (Shanghai) Co Ltd. |
China |
Imperial Chemical Industries Limited |
UK |
Akzo Nobel Decorative Coatings B.V. |
Netherlands |
Akzo Nobel Coatings SPA |
Italy |
Acquisitions
On November 8, 2019, we acquired Mapaero in France to further strengthen our global position in the aerospace coatings industry. In 2019, we performed a preliminary purchase price allocation, resulting in €83 million of goodwill, that has been fully allocated to business unit Automotive and Specialty Coatings. The purchase price allocation was completed in 2020, resulting in €6 million higher goodwill, €10 million lower intangibles and €4 million lower deferred tax liabilities.
On April 1, 2020, we completed the acquisition of Mauvilac Industries Limited, a leading paints and coatings company on Mauritius, for €33 million. The business generated revenue of €17 million (unaudited) in 2019. This transaction resulted in €12 million goodwill and €19 million of intangibles, both fully allocated to business unit Decorative Paints Europe, Middle East and Africa.
On December 23, 2020 we completed the acquisition of New Nautical Coatings Inc. in the US for €59 million. This company owns the globally and nationally recognized brands of Sea Hawk Paints, Flexdel and Blue Water Marine Paint. The business generated revenue of €16 million (unaudited) in 2020. We performed a preliminary purchase price allocation, resulting in €22 million of goodwill and €29 million of intangibles, both fully allocated to business unit Marine and Protective Coatings.
In € millions |
Mauvilac Industries Ltd., Mauritius |
New Nautical Coatings Inc., USA |
Other* |
Total 2020 |
||
|---|---|---|---|---|---|---|
Other intangibles |
19 |
29 |
(6) |
42 |
||
Property. plant and equipment |
2 |
2 |
1 |
5 |
||
Inventories |
4 |
4 |
— |
8 |
||
Trade and other receivables |
3 |
2 |
— |
5 |
||
Cash and cash equivalents |
(1) |
1 |
— |
— |
||
Deferred tax assets/ |
(3) |
— |
3 |
— |
||
Trade and other payables |
(3) |
(1) |
— |
(4) |
||
Net identifiable assets and liabilities |
21 |
37 |
(2) |
56 |
||
Goodwill |
12 |
22 |
14 |
48 |
||
Purchase consideration |
33 |
59 |
12 |
104 |
||
Cash and cash equivalents acquired |
1 |
(1) |
— |
— |
||
Paid in 2020 related to acquisitions in previous years |
— |
— |
16 |
16 |
||
To be paid in 2021 and later years |
— |
— |
(7) |
(7) |
||
Net cash outflow |
34 |
58 |
21 |
113 |
||
|
||||||
In 2020, other smaller acquisitions include the Powder Coatings business of Poederlak Benelux B.V. and the Stahl Performance Powder Coatings activities.
Payments in 2020 for acquisitions in previous years included an amount of €14 million for Mapaero.
Divestments
In 2020 and 2019, no significant divestments occurred.
Discontinued operations and held for sale
The results from discontinued operations in 2020 and 2019, mainly relate to the former Specialty Chemicals and Organon BioSciences businesses. The cash flows from discontinued operations in 2020 predominantly concerned the former Deco North America business (2019: Specialty Chemicals).
In € millions |
2019 |
2020 |
|---|---|---|
Revenue |
— |
— |
Expenses |
— |
— |
Profit before tax |
— |
— |
Income tax |
— |
— |
Profit for the period after tax |
— |
— |
Results related to discontinued operations in previous years |
21 |
1 |
Tax related to discontinued operations in previous years |
1 |
(8) |
Total profit/ |
22 |
(7) |
In € millions |
2019 |
2020 |
|---|---|---|
Net cash from operating activities |
(10) |
(3) |
Net cash from investing activities |
– |
– |
Net cash from financing activities |
– |
– |
Cash flows from discontinued operations |
(10) |
(3) |
Operating income is defined in accordance with IFRS and includes the relevant identified items. Adjusted operating income excludes identified items.