4. Purchase and sale of shares in subsidiaries

On 28 September 2020, HHLA International GmbH, Hamburg, signed a shareholding and partnership agreement for the acquisition of 50.01 % of shares in Piattaforma Logistica Trieste S.r.l., Trieste, Italy (PLT). The object of the company is the planning, construction, maintenance and management of the logistics platform between Scalo Legnami and the former Italsider steelworks in the port centre of Trieste. Among other things, this includes conducting operations as a port company, storing materials and goods on behalf of third parties and the promotion, organisation, management and marketing of all services in connection with the exchange of goods, particularly intermodal exchange by ship, train and overland transport and the use of terminals that are equipped for goods transport and logistics of all kinds. The closing of the transaction (corresponding to the acquisition date) was tied to various closing conditions and took place on 7 January 2021. On the same date, the company was renamed HHLA PLT Italy S.r.l. The first-time consolidation of the company took place on the acquisition date. The company was therefore fully consolidated for the first time on 31 March 2021. The purchase price (transferred consideration) was paid in euros.

A capital increase in the amount of € 12,008 thousand was carried out in connection with the acquisition of the shares. The agreements also include various options for both the purchaser and the seller, some of which are mutually dependent. For HHLA PLT Italy S.r.l., various options exist in the medium term to expand the existing infrastructure. HHLA therefore has the opportunity to successively increase its interest by acquiring the shares of former shareholders in conjunction with further capital increases. If these options to expand are not utilised, the former shareholders have the option of selling their remaining shares for € 21,000 thousand to HHLA or maintaining the status quo. As it cannot be ruled out that the former shareholders will exercise the option to sell, a discounted financial liability was recognised directly in equity as part of the first-time consolidation. Utilisation of the options to expand and therefore their occurrence are subject to the approval of HHLA’s Supervisory Board. A comprehensive valuation of the transaction has not yet been performed.

The following tables depict the consideration transferred for the acquisition of the company and the values of the assets identified, and liabilities acquired, on the date of acquisition based on the acquisition of 50.01 % of the shares:

The fair values of the acquired assets and assumed liabilities have only been determined on a provisional and possibly incomplete basis, as, for example, the measurement of the underlying figures is taken from the non-audited Consolidated Financial Statements. The final measurement has yet to be completed, meaning that changes to the fair values may still occur. This would result in a change in preliminary goodwill.

Preliminary goodwill in the amount of € 8,434 thousand based on the acquisition of 50.01 % of the shares reflects the future development of the newly built terminal, as well as the existing general cargo activities and the associated establishment and expansion of customer relations. Besides participating in the growth of activities, HHLA has the prospect of further expanding its rail operations in the Intermodal segment in the Mediterranean and offering customers holistic transport solutions. The goodwill has been allocated to the Container segment. It is not anticipated that a portion of the recorded goodwill will be tax deductible.

The acquired customer relations in the amount of € 1,018 thousand relate to general cargo.

The fair value of trade receivables amounts to € 1,668 thousand and is collectable in full.

The pro rata net assets of the non-controlling interests recognised as part of the company acquisition is € 3,068 thousand based on the acquisition of 50.01 % of the shares. This valuation is based on the same criteria that were used to value the acquired assets and liabilities.

Between 1 January and 30 June 2021, the acquired business operations contributed to the HHLA Group’s result with revenue of € 2,518 thousand and a loss of € 4,055 thousand.

With the shareholding and partnership agreement of 16 December 2020, Hamburger Hafen und Logistik Aktiengesellschaft (HHLA) acquired 80.0 % of shares in iSAM AG, Mülheim an der Ruhr. The object of the company is the development and distribution of IT software and the distribution of IT hardware; consultancy on the development of internal IT concepts, the design and implementation of system solutions, as well as consultancy, development and production with regard to automation concepts in manufacturing, trading and service companies. The closing of the transaction (corresponding to the acquisition date) is tied to various closing conditions and took place on 19 January 2021. The first-time consolidation of the company took place on the acquisition date. The company was therefore fully consolidated for the first time on 31 March 2021.

In the event that existing shareholders wish to sell shares in the company, HHLA has a pre-emptive and co-sale right.

The following table depicts the values of the assets identified, and liabilities acquired, on the date of acquisition:

The fair values of the acquired assets and assumed liabilities have only been determined on a provisional and possibly incomplete basis, as, for example, the measurement of the underlying figures is taken from the non-audited Consolidated Financial Statements. The final measurement has yet to be completed, meaning that changes to the fair values may still occur. This would result in a change in preliminary goodwill.

Preliminary goodwill in the amount of € 6,843 thousand reflects the opportunity to participate in the future development of the Group and the leveraging of synergies for HHLA’s own operations (process optimisations in the area of container handling, strengthening customer loyalty, cross-selling potential). The goodwill has been allocated to the Logistics segment. It is not anticipated that a portion of the recorded goodwill will be tax deductible.

The acquired technologies in the amount of € 1,791 thousand reflect the software solutions developed and marketed by the company to automate process chains in a variety of industries (steel, transport and logistics, and aviation).

Customer relations exist with big-name companies in the logistics, commodities, mining and aviation industries. Thanks to the company’s long history stretching back to 1983, the software solutions sold under the iSAM brand since 2002 together with the corresponding hardware solutions for the automation of process chains are well known in the relevant industries.

Subject to a preliminary assessment pursuant to Section 8c (1) sentence 7 of the German Corporation Tax Act (KStG), it is possible to recognise loss carryforwards that can be used for tax purposes.

The fair value of trade receivables amounts to € 750 thousand and is collectable in full.

The fair value of non-controlling interests recorded during the company acquisition stands at € 1,889 thousand. This valuation is based on the same criteria that were used to value the acquired assets and liabilities.

Between 1 January and 30 June 2021, the acquired business operations contributed to the HHLA Group’s result with revenue of € 3,542 thousand and a profit of € 1,157 thousand.

There were no other acquisitions or disposals of shares in subsidiaries in the reporting period.