4. Purchase and sale of shares in subsidiaries

With the share purchase and transfer agreement dated 22 December 2022, HHLA Next GmbH, Hamburg, Germany, acquired a 51.0 % share in Survey Compass GmbH, Treben. The object of the company is the provision of online content, the transfer of software and hardware and consultancy in the logistics and transport industry (focusing on railways, ships, aircraft and trucks) as well as associated industries. The closing of the transaction (corresponding to the acquisition date) is tied to various conditions and took place on 17 January 2023. The first-time consolidation of the company took place on the acquisition date. The company is assigned to the Logistics segment. The company was incorporated into HHLA’s group of consolidated companies as of 31 March 2023. The purchase price (transferred consideration) was paid in euros.

A capital increase in the amount of € 2,000 thousand was carried out in connection with the acquisition of the shares and added to subscribed capital and the capital reserves.

The following tables depict the consideration transferred for the acquisition of the company as well as the values of the assets identified, and liabilities acquired, on the date of acquisition based on the acquisition of 100 % of the shares:

The amount of the contingent consideration, with a maximum amount of € 1,500 thousand, is based on the achievement of individual targets (milestone payments primarily for new customer acquisition, for profit performance and for product development/ positioning in the market) that are independent of each other and measured at a respective partial amount. The fair value of the contingent consideration was discounted at a discount rate of 12.5 to 12.8 % and totals € 1,061 thousand.

The derived goodwill in the amount of € 3,623  thousand reflects the opportunities for further expansion and therefore the future development of the company as well as the exploitation of synergies for the business of HHLA Next GmbH. The goodwill is allocated to the Logistics segment. It is not anticipated that a portion of the recorded goodwill will be tax deductible.

The intangible assets acquired essentially related to the software solutions developed by the company in the course of container asset management which were measured using capital value-based procedures with the licence price analogy method.

The fair value of trade receivables amounts to € 54 thousand and is collectable in full.

The proportionate net assets of the non-controlling interests recognised in the course of the business combination amount to € 1,339 thousand based on the acquisition of 51.0 % of the shares. This valuation is based on the same criteria used to value the acquired assets and liabilities.

Between 1 January and 30 June 2023, the acquired business operations contributed to the HHLA Group’s result with revenue of € 87 thousand and a loss after tax of € 33 thousand.

The transaction costs associated with the acquisition were immaterial.

With the share purchase and transfer agreement dated 2 March 2023, the subsidiary Metrans a.s., Prague, Czech Republic, acquired a 51.0 % share in Adria Rail d.o.o., Rijeka, Croatia. This company has two subsidiaries (Adria Rail operator d.o.o., Rijeka, Croatia, and DRUŠTVO ZA INTERMODALNI PREVOZ I USLUGE ADRIA RAIL DOO INDIJA, Indija, Serbia); in each case with a shareholding of 100 %. The purpose of the company is to provide forwarding and transport services with daily rail operations between the port of Rijeka and Serbia. The closing of the transaction (corresponding to the acquisition date) took place on 2 March 2023. The first-time consolidation of the company took place on the acquisition date. The company has been assigned to the Intermodal segment. The company was incorporated into HHLA’s group of consolidated companies as of 31 March 2023.

The transferred consideration (basic purchase price) was € 2,000 thousand and was paid in euros.

The following table depicts the consideration transferred for the acquisition of the company as well as the values of the assets identified and liabilities acquired on the date of acquisition based on the acquisition of 100 % of the shares:

The fair values of the acquired assets and assumed liabilities have only been determined on a provisional basis as of 30 June 2023. The final measurement has yet to be completed and may lead to changes in the fair values of the assets and liabilities. This would result in a change in goodwill. As of 31 March 2023, the provisionally derived goodwill was € 690 thousand and changed primarily as a result of a revaluation of customer relationships.

The provisionally derived goodwill as of 30 June 2023 in the new amount of € 1,118 thousand reflects the opportunities for further expansion and therefore the future development of the company as well as the exploitation of synergies and new entry points for the Metrans Group’s existing network. The goodwill has been allocated to the Intermodal segment, and specifically to the Metrans cash-generating unit. It is not anticipated that a portion of the recorded goodwill will be tax deductible.

The fair value of trade receivables amounts to € 2,044 thousand and is collectable in full.

The proportionate net assets of the non-controlling interests recognised in the course of the business combination amount to € 847 thousand based on the acquisition of 51.0 % of the shares. This valuation is based on the same criteria used to value the acquired assets and liabilities.

Between 2 March and 30 June 2023, the acquired business operations contributed to the HHLA Group’s result with revenue of € 3,666 thousand and a loss after tax of € 32 thousand. Had the acquisition taken place on 1 January 2023, consolidated revenue of € 5,536 thousand and consolidated profit of € 29 thousand would have been recorded in the consolidated income statement. When calculating these amounts, management has assumed that the adjustments to fair values performed as of the acquisition date would still have remained valid in the event of an acquisition on 1 January 2023.

The transaction costs associated with the acquisition were immaterial.

The company HHLA Container Terminal Altenwerder GmbH, Hamburg (CTA), in which HHLA AG holds 74.9 % of the shares, transferred all its shares in SCA Service Center Altenwerder GmbH, Hamburg, Germany, (SCA), to HHLA AG effective 1 January 2023. The indirect shareholding in SCA’s capital thus increased from 74.9 to 100 %.

The disposal date of the share disposal agreement for a non-controlling interest of 24.99 % in HHLA Container Terminal Tollerort GmbH, Hamburg (CTT) concluded on 19 June 2023 between HHLA AG and Grand Dragon Investment Enterprise Limited, Hong Kong, China, a subsidiary of COSCO SHIPPING Ports Limited, Hong Kong, China (CSPL), is 20 June 2023. This change in the HHLA Group’s shareholding in a subsidiary is recognised directly in equity as an equity transaction as it does not lead to a loss of control. The transaction costs of this equity transaction are likewise to be recognised directly in equity as a deduction from the capital reserve.

A profit and loss transfer agreement is in place between HHLA AG and CTT until 31 December 2023. On the basis of the purchase agreement, HHLA AG pledges to pay a pro rata settlement liability to the non-controlling shareholder in the event of a positive annual result and likewise is entitled to a pro rata settlement receivable in the event of a negative annual result for the 2023 financial year. HHLA AG’s entitlement to a receivable for the expected negative annual result in 2023 was recognised directly in equity and, as a financial receivable, increased the non-controlling interests in equity accordingly.

The recognition of the disposal of the shares directly in equity is reported separately in the statement of changes in equity.

In connection with the sale of the shares, an existing shareholder loan of HHLA AG was assumed on a pro rata basis by the non-controlling shareholder in the amount of € 19,992 thousand.

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