Note 6 Business combinations

2019

In 2019 Peab acquired 100 per­cent of the shares in Peab As­falt­fräs­ning AB. The company is active in South and Central Sweden, particularly in Kro­no­berg County and Väst­man­land County. During the year Peab also acquired the assets of Aktør som byg­ger AS that does contracting work in North Norway.

The above acquisitions in 2019 in­di­vi­du­ally had no material acquisition effects from the Group’s perspective and information on acquisition effects is given collectively.

In the period after acquisition the above subsidiaries and operations contributed SEK 178 million to Group revenue and SEK 6 million to Group profit in 2019. If the acquisitions had occurred on January 1, 2019, the combined effect of these acquisitions on Group revenue would have been SEK 206 million and SEK 6 million on profit for the year.

The remaining 40 percent of the shares in AB Smid­mek Eslöv were also acquired in 2019. The company was already 100 per­cent consolidated through application of the An­ti­ci­pa­ted ac­qui­si­tion met­hod, since there was a put/call op­tion for the acquisition of the remaining shares.

Effects of acquisitions in 2019

The acquisitions’ pre­li­mi­nary ef­fects on Group assets and liabilities are shown below. The acquisition analyses may be adjusted during a twelve month period.

Good­will primarily consists of human resources and future synergy effects regarding common systems and shared resources which do not meet the criteria for recognition as intangible assets at the time of acquisition.

To­tal transferred compensation amounted to SEK 22 million.

During the year assets have also been acquired through share acquisitions (asset acquisitions that are not business combinations) which resulted in a cash flow of SEK -101 million and primarily refer to project and development properties with development rights in Norway and Gothenburg.

Acquisitions after the balance sheet date

On July 4, 2019 Peab signed a contract to acquire YIT’s paving and mineral aggregates operations in the Nor­dic region. The trans­ac­tio­n was conditional on approval from competition authorities as well as the fulfillment of certain contractual conditions. At the end of March 2020 the tranasaction was approved by the competition authorities. The takeover took place on April 1, 2020.

The transaction is a combination of an asset deal and a share purchase. The purchase price is expected to amount to SEK 2,966 million for a debt-​free business and is fully financed.

The acquired business had net sales of SEK 6,005 million with an adjusted EBITDA of SEK 240 million in 2018.

Due to the take over took place on April 1, 2020 Peab is not able to provide additional financial information when subimitting this report.

For further information see Board of Directors’ report the section Important events during the year under Other information and appropriation of profit.

2018

In 2018 Peab acquired 100 percent of the shares in Asfaltpartner i Väst Produktion AB (name changed to Peab Asfalt Väst AB). The company operates in Western Götaland, particularly in the  Gothenburg and Borås regions. During the year Peab also acquired Hoffmans Entreprenad AB (name changed to ATS Entreprenad AB) which does electrical power contract work in Norrbotten. Røstad Maskin 2 AS (name changed to Røstad Maskin AS), which works in civil engineering in Tromsö was also acquired.

The above acquisitions in 2018 individually do not have any material acquisition effect from a Group perspective and the information on acquisition effects is therefore given collectively.

In the period after acquisition the above subsidiaries contributed with SEK 91 million to Group revenue and SEK 2 million to profit in 2018. If the acquisitions had taken place on 1 January 2018, the combined effect of these acquisitions on Group revenue would have been SEK 134 million and on profit for the year by SEK 5 million.

During the year, the acquisition of assets also occurred through the acquisition of shares (asset acquisitions which are not business combinations) which resulted in a cash flow of SEK -45 million and primarily refer to project and development properties with development rights in Stockholm and Örebro.