AVESCO GROUP PLC ANNUAL REPORT 2008 57
www.avesco.com
b) Investments in associates
2008 2007
Group £000s £000s
At 1 October - 5,889
Share of associates’ loss after tax - (227)
Disposals - (4,605)
Provision for impairment - (1,057)
At 30 September - -
The Group’s associates during the year ended September 2007 were: Complete Communications Corporation Limited (“Complete”), a company registered in
England and Wales and engaged in television programme production and rights exploitation, and Medal Entertainment & Media plc (“MEM”), an AIM quoted
media company. The Group had no associates during the year ended September 2008.
Complete
The investment in Complete was sold on 20 December 2006 to 2waytraffic N.V.. The proceeds were 1,534,162 ordinary shares of €0.01 each in 2 Way Traffic N.V.
issued at a total subscription price of £1.9 million, £4.9 million held in a retention account that is subject to deduction for potential warranty and indemnity claims
(£0.4m has been provided against this amount for possible litigation costs), £23.0 million in cash (net of expenses) and £1.5 million in cash based on the final
net assets of Complete. Additional consideration may also be receivable depending on the outcome of certain litigation in the United States. A gain on disposal
of £31.4 million was recognised in the results to 30 September 2007 but is subject to change pending any future adjustments in respect of the final amount due
from the retention account and the results of litigation by and against Complete in progress. The Group’s share of the results and aggregated assets of
Complete, which have been disclosed within discontinued operations in the consolidated income statement, for the pre disposal trading in the year ended 30
September 2007 was as follows:
2008 2007
Group £000s £000s
Assets --
Liabilities
Revenues - 3,548
Profit - 327
(Loss)/profit from discontinued operations
The (loss)/profit from discontinued operations relates to trading and disposal of Complete as follows:
2008 2007
£000s £000s
Share of associates’ trading operating profit and interest - 539
Share of associates’ provision for litigation claims (i) - (810)
Share of associates’ profit on disposal of investments (ii) - 597
(Loss)/gain on disposal of associate (iii) (1,250) 31,405
(1,250) 31,731
i) Share of associates’ provision for litigation claims is in respect of Complete where provision has been made for outstanding litigation claims both by and
against Complete. The tax effect of this item is £nil.
ii) Share of associates’ profit on disposal of investments is in respect of the profit made by Complete when it sold some of its own subsidiaries just prior to its
own sale to 2waytraffic N.V.. The tax effect of this item is £nil.
iii) (Loss)/gain on disposal of associate is in respect of the profit made on the sale of the Group’s 49% holding in Complete to 2waytraffic N.V.. The tax effect of
this item is £nil.
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