Basic HTML Version
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
42. Acquisitions
and disposals
(continued)
The excess earnings methodology states that the value of an intangible asset is
given by the present value of the earnings it generates, net of a reasonable return
on other assets also contributing to that stream of earnings.
The valuations are based on information at the time of acquisition and the
expectations and assumptions that have been deemed reasonable by the
Group’s management. It has been assumed that the underlying assumptions or
events associated with such assets will occur as projected.
On 30 September 2010, DMI acquired an additional 18,926,276 shares in
Ithmaar Bank B.S.C. at a price of $0.31 per share for a total purchase price of
$5,867,146, further increasing the equity ownership to 53.28%.
The profit of Ithmaar Bank B.S.C. prior to 31 March 2010, the date of its
conversion from an associate to a subsidiary, amounted to $1.6 million which
is included in the share of profit/(loss) of associated companies in the
consolidated statement of income. The loss of Ithmaar Bank B.S.C. since
31 March 2010 included in the Group’s consolidated statement of income
for the twelve month period ended 31 December 2010 amounted to $77.5
million, net of non-controlling interests. If the conversion had occurred on
1 January 2010, the consolidated loss after taxes for the twelve months ended
31 December 2010 would have been $73.9 million, net of non-controlling
interests.
On 14 April 2010 the Central Bank of Bahrain approved the reorganisation of
Ithmaar Bank B.S.C. and its wholly owned subsidiary Shamil Bank of Bahrain
B.S.C. into one entity under Ithmaar Bank B.S.C. with an Islamic retail banking
license. As a result Shamil Bank has transferred its entire business, assets and
liabilities to Ithmaar.
On 30 September 2010 Islamic Investment Company of the Gulf (Bahamas)
Limited purchased 100% equity interests in four subsidiaries DMI Jersey
Limited, MFAI Jersey Limited, Faisal Finance Jersey Limited and Rayten Limited
from Ithmaar Bank B.S.C. for a total consideration of $4.9 million. This
transaction from the Group level resulted in the purchase of non-controlling
interests in the consolidated financial statements.
Pakistan operations of Royal Bank of Scotland
During 2010, one of the Group’s subsidiaries, Faysal Bank Limited (FBL),
acquired the Pakistan operations of Royal Bank of Scotland (RBS). FBL
acquired the majority shareholding of 99.37% of RBS for cash consideration of
approximately
€
41.0 million on the acquisition date of 15 October 2010 and
RBS became a subsidiary of FBL as at the aforementioned date. The remaining
0.63% non-controlling interest was acquired subsequently by FBL through
issuance of ordinary shares. Effective 31 December 2010, RBS has been
consolidated with FBL.
80
Dar Al-Maal Al-Islami Trust
Annual Report 2011