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3 Scope of consolidation

3.1 Disclosure of interests in other entities

The scope of the consolidation does not include an interest in any of the following:

  • Subsidiaries with non-controlling interests
  • Associates
  • Joint arrangements

The following subsidiaries are included in the consolidated financial statements:

 

Company

Registered office

Participation in % (capital and votes)

Currency

Share capital 
(LC 1,000)

Activities

Tecan Schweiz AG

Männedorf/Zurich (CH)

100%

CHF

5,000

R/P/D

Tecan Trading AG

Männedorf/Zurich (CH)

100%

CHF

300

S/D

• Pulssar Technologies S.A.S

Paris (FR)

100%

EUR

400

Liquidated in 2021

Tecan Sales Switzerland AG

Männedorf/Zurich (CH)

100%

CHF

250

D

Tecan Austria GmbH

Grödig/Salzburg (AT)

100%

EUR

1,460

R/P

Tecan Sales Austria GmbH

Grödig/Salzburg (AT)

100%

EUR

35

D

Tecan Sales International GmbH

Grödig/Salzburg (AT)

100%

EUR

35

D

Tecan Landesholding GmbH

Crailsheim/Stuttgart (DE)

100%

EUR

25

S

• Tecan Deutschland GmbH

Crailsheim/Stuttgart (DE)

100%

EUR

51

D

• Tecan Software Competence Center GmbH

Mainz-Kastel (DE)

100%

EUR

103

R

• IBL International GmbH

Hamburg (DE)

100%

EUR

25

R/P/D

Tecan Benelux B.V.B.A.

Mechelen (BE)

100%

EUR

37

D

Tecan France S.A.S.

Lyon (FR)

100%

EUR

2,760

D

Tecan Iberica Instrumentacion S.L.

Barcelona (ES)

100%

EUR

30

D

Tecan Italia S.r.l.

Milano (IT)

100%

EUR

77

D

Tecan UK Ltd.

Reading (UK)

100%

GBP

500

D

Tecan Nordic AB

Stockholm (SE)

100%

SEK

100

D

Tecan US Group, Inc.

Morrisville, NC (US)

100%

USD

1,500

S

• Tecan US, Inc.

Morrisville, NC (US)

100%

USD

400

D

• Tecan Systems, Inc.

San Jose, CA (US)

100%

USD

26

R/P

• Tecan SP, Inc. 

Baldwin Park/Los Angeles, CA (US)

100%

USD

472

R/P/D

• Tecan Genomics, Inc.

Redwood City, CA (US)

100%

USD

0

R/P/D

• DCPM, Inc. 

Morgan Hill, CA (US)

100%

USD

58

P/D

• Paramit Acquisition Corp.

Morgan Hill, CA (US)

100%

USD

0

S

– Paramit Corp.

Morgan Hill, CA (US)

100%

USD

0

P/D

– Paramit Product Development – 
Silicon Valley, Inc.

Morgan Hill, CA (US)

100%

USD

0

R/D

– Emphysys Holdings, Inc.

Boston, MA (US)

100%

USD

0

S

– Emphysys, Inc.

Boston, MA (US)

100%

USD

0

R/D

– Paramit Malysia Sdn. Bhd.

Penang (MY)

100%

USD

0

P/D

IBL International Corp.

Toronto (CA)

100%

USD

0

Liquidated in 2021

Tecan Asia (Pte.) Ltd.

Singapore (SG)

100%

SGD

800

S

Tecan (Shanghai) Trading Co., Ltd.

Shanghai (CN) 

100%

CNY

3,417

D

PMAS Co., Ltd

Ben Cat Town, 

Binh Duong Province (VN)

100%

VND

10,367,000

P

Tecan Japan Co., Ltd.

Kawasaki(JP)

100%

JPY

125,000

D

Tecan Australia Pty Ltd

Melbourne (AU)

100%

AUD

0

D

 

S = services, holding functions, R = research and development, P = production, D = distribution

 

3.2 CHANGE IN SCOPE OF CONSOLIDATION: ACQUISITION THROUGH BUSINESS COMBINATION

 

3.2.1 Acquisition of Paramit Group

On August 2, 2021, the Group acquired 100% of the voting rights of Paramit Group, consisting of the following entities:

 

Company

Registered office

Participation in %

Activities

Paramit Acquisition Corp.

 

100%

S

• Paramit Corp.

Morgan Hill, CA (US)

100%

P/D

• Paramit Product Development – Silicon Valley, Inc.

Morgan Hill, CA (US)

100%

R/D

• Emphysys Holdings, Inc.

Boston, MA (US)

100%

S

• Emphysys, Inc.

Boston, MA (US)

100%

R/D

• Paramit Malysia Sdn. Bhd.

Penang (MY)

100%

P/D

 

S = services, holding functions, R = research and development, P = production, D = distribution

Paramit develops and manufactures medical devices and life sciences instruments. The acquired Group provides its customers with fully integrated engineering, initial product design, prototype development, commercial scale manufacturing, test solutions and assembly services. Paramit employs about 1’000 employees. The acquisition will further extend the Group’s position in solutions for life sciences and in-vitro diagnostics (IVD). It will also add a new business vertical in the attractive and fast-growing market for medical devices. The acquisition will bring significant engineering as well as cost-competitive manufacturing capabilities, both in North America and in the APAC region. 

 

 

The fair value of the identifiable assets and liabilities at the date of acquisition were (provisional):

 

 

 

02.08.2021

Paramit Group

CHF 1,000

 

 

Cash and cash equivalents

 

34,950

Trade accounts receivable (gross contractual amount of CHF 31.9 million)

 

31,639

Contract assets

 

16,673

Other accounts receivable

 

407

Inventories

 

44,802

Income tax receivables

 

3,818

Prepaid expenses

 

2,220

Property, plant and equipment

 

30,444

Right-of-use assets

 

27,897

Intangible assets

 

311,308

Deferred tax assets

 

1,220

 

 

 

Assets

 

505,378

 

 

 

Current financial liabilities

 

(109,017)

Trade and other accounts payable

 

(21,258)

Contract liabilities

 

(15,314)

Income tax payables

 

(2,657)

Accrued expenses

 

(16,116)

Current provisions

 

(8,872)

Non-current financial liabilities

 

(24,702)

Deferred tax liabilities

 

(79,903)

 

 

 

Liabilities

 

(277,839)

 

 

 

Total identifiable net assets at fair value

 

227,539

 

Details of the purchase consideration recognized at acquisition and the derivation of goodwill are as follows:

 

 

Notes

02.08.2021

Paramit Group

CHF 1,000

 

 

 

Cash consideration

 

 

828,331

Hedge loss transferred from equity; net of income taxes

 

28.4.3

11,700

Contingent consideration

 

 

12,409

 

 

 

 

Total purchase consideration

 

 

852,440

 

 

 

 

Less total identifialbe net assets at fair value

 

 

(227,539)

 

 

 

 

Goodwill arising on acquisition

 

 

624,901

 

Analysis of the cash flows on acquisition:

 

CHF 1,000

 

Notes

 

Cash paid

 

 

828,331

Hedge loss

 

28.4.3

13,193

Net cash acquired

 

 

(34,950)

Contingent consideration paid

 

 

10,872

 

 

 

 

Net cash outflow

 

 

817,447

 

The acquisition was accounted for using the acquisition method. The resulting goodwill includes expected synergies from the acquisition, the work force and potentially other intangible assets that could not be valued separately. The goodwill arising from this acquisition is not expected to be tax deductible. The accounting for the acquisition is provisional and subject to change regarding the valuation of inventories and income taxes. Further analysis has to be performed in order to confirm the assessment.

 

The consideration transferred is USD 940.9 million (CHF 852.4 million), including an estimated contingent consideration (earn-out) of USD 13.7 million (CHF 12.4 million) determined using a probability-weighted payment approach. The purchase price was paid in cash, financed with a short-term bridge loan that was granted by a bank. Later, the bridge loan was repaid and partially replaced by an authorized share capital increase and the issuance of a bond. 

 

The contingent payment was based on an EBITDA-defined milestone and capped at USD 80 million (CHF 74 million), The earn-out period ended on September 30, 2021.The final settlement amount of USD 12.0 million (CHF 10.9 million) was paid shortly before year-end.

 

As part of the acquisition of the Paramit Group, the financing facilities of Paramit in the amount of USD 117.0 million (CHF 107.0 million) were settled by the Group immediately after closing of the transaction. The cash out flow is presented under ‘Repayment of other bank loans’ / cash from financing activities in the consolidated cash flow statement.

 

3.2.2 Contribution of acquired companies in the year of acquisition and consolidated numbers (unaudited)

 

 

 

2021

CHF 1,000

 

 

Contribution of acquired companies from the date of acquisition

 

 

Months

 

5

Sales

 

113,313

Operating profit

 

(5,135)

 

 

 

Consolidated numbers, if the acquisition occurred at the beginning of the reporting period 

 

 

Sales

 

1,095,867

Operating profit1

 

152,498

 

 

 

Acquisition-related legal fees and due diligence costs, included in 'general and administration'

 

3,508

  1. In determining these amounts, management has assumed that the fair value adjustments that arose on the acquisition date w ould have been the same as if the acquisition had occurred on January 1, 2021.

 

3.3 ASSETS AND DISPOSAL GROUPS HELD FOR SALE

There are no assets and disposal groups held for sale at December 31, 2021.

 

3.3.1 Unquoted equity instrument (Andrew Alliance SA)

End of 2019, the management started sales negotiations for the unquoted equity instrument. Therefore, the financial asset of CHF 3.0 million was classified as held for sale at year-end 2019. The Group continued to measure the investment at fair value through other comprehensive income (FVOCI) in accordance with IFRS 9 using the discounted cash flow method with level 3 inputs of the fair value hierarchy.

In January 2020, the Group signed a final share purchase agreement with a cash consideration of CHF 4.6 million. The resulting gain of CHF 1.6 million was recognized in other comprehensive income of 2020. The contingent payment (earn-out) of CHF 0.2 million was paid in July 2021 and recognized in profit or loss of 2021.

3.3.2 Disposal group ‘Property Hombrechtikon’

In December 2020 the management entered into sales negotiations with a potential buyer for the property in Hombrechtikon. Consequently, land and building were classified as held for sale at year-end. In January 2021, the Group signed a final purchase agreement with a total consideration of CHF 4.2 million. The gain of this transaction (CHF 1.0 million) was recognized in other operating income of 2021.

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