PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of March 31, 2014 and for three months period then ended unaudited
Figures in tables are expressed in billions of rupiah, unless otherwise stated
36
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued aa. Critical Accounting Estimates and Judgements continued
v. Impairment of non-financial assets continued
In determining value in use, the Company and subsidiaries apply management judgement in establishing forecasts of future operating performance, as well as the selection of growth rates
and discount rates. These judgements are applied based on our understanding of historical information and expectations of future performance. Changing the key assumptions, including
the discount rates or the growth rate assumptions in the cash flow projections, could materially affect the value in use calculations.
For the years ended December 31, 2013, the Company recognized Rp596 billion of impairment loss on property and equipment pertaining to the fixed wireless services. A 1
increase in the discount rate used would result in an increase in impairment loss of approximately Rp703 billion in 2013. However, the recoverable amount of the fixed wireless
CGU is most sensitive to whether management will be able to implement its plans, including the cost efficiency plan, such that it generates positive cash flows and returns to profitability
as projected. If the performance of the fixed wireless CGU continues to decline or if management’s initiatives are not performing as expected in the next financial year, analysis
will be required to assess whether there will be further impairment next year Note 11b.
vi. Fair value of put option and investment in PT Indonusa Telemedia
Indetermining the fair value, the Company uses management’s judgment to determine future projected operational performance, growth rate and discount rate. These considerations are
applied on the basis ofmanagement’s understanding of historical information and expectation of future operational performance. Detail of the nature and recorded amount of Put Option and
investment in Indonusa is disclosed in Notes 3,5 and 10.
3. BUSINESS COMBINATIONS a. Acquisitions
Acquisition of PT German Center Indonesia On January 17, 2013, Sigma signed a sales and purchase of sharesagreement and transfer of
debt with Landeskreditbank Baden-Wurttemberg-Forderbank “L-Bank” and Step Stuttgarter Engineering Park Gmbh “STEP” as the shareholders of PT German Centre Indonesia “GCI”.
Based on the agreement, on April 30, 2013, Sigmahas bought shares owned by L-Bank and STEP in GCI.Through the acquisition, Sigma enlarged its data center capacity that can be offered
its customers.
Acquisition of Patrakom On September 25, 2013, based on notarial deed No. 22 of Ashoya Ratam, S.H.,M.Kn, the
Company entered into a Sales and Purchase Agreement SPA with PT ELNUSA Tbk for the Company’s acquisition of the 40 ownership in PT Patra Telekomunikasi Indonesia “Patrakom”
for Rp45.6 billion. This SPA results in the Company’s ownership in Patrakom to increase from 40 to 80 Note 10.
Subsequently, onNovember 29, 2013, based on notarial deed No. 54 of Ashoya Ratam, S.H., M.Kn., dated November 29, 2013 the Company has signed a SPA with PT Tanjung MustikaTbk
for the Company’s acquisition of the remaining of 20 ownershipin Patrakomfor Rp24.8 billion.
PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of March 31, 2014 and for three months period then ended unaudited
Figures in tables are expressed in billions of rupiah, unless otherwise stated
37
3. BUSINESS COMBINATIONS continued a. Acquisitions continued
Acquisition of Patrakomcontinued Patrakom is a satellite-based closed fixed telecommunications network operator and as provider
of communications solutions and network with a permit as Operator of Micro Earth StationsCommunications
Systems “SKSBM”
in partnership
with manufacturers
of telecommunications equipment to serve various companies.Through the acquisition of Patrakom,
the Company canintegrate Patrakom’s business activities in accordance with the Company’s business development plan.
The fair values of the assets acquired and liability transferred at the acquisition datesare as follows:
GCI Patrakom
Total Cash and equivalents
3 39
42 Other current assets
18 122
140 Property and equipment Note 11
225 171
396 Current liabilities
15 171
186 Non-current liabilities
16 45
61 Fair value of the identifiable net
assets acquired 215
116 331
Bargain purchase 42
- 42
Fair value of previously held equity interests -
46 46
Fair value of the consideration transferred 173
70 243
The excess of fair value of the identifiable net assetsacquiredover thefair value of the consideration transferred, amounting Rp42 billion, wasrecorded as other income in the
consolidated statement of comprehensive income of the current year. Cost related to the acquisition amountingto Rp4.3 billion was incurred in the current period.
Since the acquisition dates, GCI and Patrakom has generated operating revenue amountingto Rp23billion.
The business combination transactions mentioned above complied to the related Bapepam-LK Regulations.
b. Disposal of Indonusa
On October 8, 2013, the Company sold 80 of its ownership in Indonusa to PT Trans Corpora and PT Trans Media Corpora for Rp926 billion. Further, on the same date, the Company, Metra
and PT Trans Corpora signed a Shareholders Agreement that establishes mutual relationship among the shareholders of Indonusa, including the grant of the right to the Company and Metra to
sell their 20 remaining ownership in Indonusa to PT Trans Corpora at any time in 24 months after the second year ofthe closing transaction at a certain price Put Option.
The Company had received the full payment for the sale transaction.
