Scope of consolidation


In addition to RWE AG, the consolidated financial statements contain all material German and foreign companies which RWE AG controls directly or indirectly. Principal associates and joint ventures are accounted for using the equity method.

Changes in the first three quarters of 2009 primarily relate to the Essent Group including 137 companies that were consolidated for the first time, as well as the RWE Energy, RWE npower and RWE Innogy Divisions, in which a total of 30 companies were consolidated for the first time. Sixteen former fully consolidated companies were removed from the scope of consolidation.

The scope of consolidation is as follows:

 

Sep 30, 2009

Dec 31, 2008

Fully consolidated companies

463

318

Investments accounted for using the equity method

124

94

Acquisitions.

The following shareholdings were acquired:

On September 30, 2009, RWE acquired 100 % of the Dutch-based power utility Essent N.V.’s voting stock in exchange for a payment (partially conditional) totalling € 7,794 million.

Since the acquisition of the controlling stake was made as of the balance-sheet date, the Essent Group has been included in the RWE Group’s consolidated financial statements only on the basis of the figures stated on the balance sheet. This resulted in the recognition of the following assets and liabilities.

Balance sheet items of the Essent Group
(preliminary figures)

€ million

IFRS carrying amounts prior to first-time consolidation

IFRS carrying amounts (fair value) upon first-time consolidation

Non-current assets

3,913

6,483

Current assets

5,514

5,693

Non-current liabilities

1,089

2,082

Current liabilities

5,525

5,693

Net assets

2,813

4,401

Minority interest

 

–2

Acquisition cost

 

7,794

Goodwill

 

3,395

The goodwill of € 3,395 million mainly stems from anticipated future economic benefits and synergy effects.

The 51 % stake in Stadtwerke Bremen that was acquired as part of the deal is being stated as an “asset held for sale” as RWE has the intention to sell it and is contractually prohibited from maintaining control.

If the business combination with Essent had already been completed as of January 1 of this year, the Group’s income and revenue would have amounted to some € 3.2 billion and € 38.2 billion, respectively.

The first-time accounting treatment of this business combination has not been finalized yet due to the transaction’s complex structure, size and closeness to the balance-sheet date.

Furthermore, on May 7, 2009, RWE Innogy paid € 48 million in cash to increase the stake held in Danta de Energías, S.A., Spain, by 49.32 percentage points to 98.65 %.

In addition, RWE Energy paid € 143 million to acquire 100 % of the shares in Favorit Fernwärme GmbH on June 30, 2009.

In addition to the Essent Group, acquisitions resulted in the recognition of the following assets and liabilities.

Balance sheet items of the other acquired companies


€ million

IFRS carrying amounts prior to first-time consolidation

IFRS carrying amounts (fair value) upon first-time consolidation

Non-current assets

108

262

Current assets

48

48

Non-current liabilities

96

143

Current liabilities

40

40

Net assets

20

127

Minority interest

 

–6

Previous value of shareholding

 

–15

Revaluation of previous shareholding

 

–34

 

 

72

Acquisition cost

 

191

Goodwill

 

119

The goodwill of € 119 million stems mainly from anticipated future economic benefits.

Since the first-time consolidation, the acquired companies have contributed € 18.6 million to Group revenue and € 1.1 million to Group income.