Note 33 Acquisitions within business areas
The combined consideration for the acquisitions was SEK 479.3 million (352.5), of which SEK 154.9 million (145.8) was allocated to goodwill and SEK 250.5 million (224.6) to other intangible assets. The consideration consists only of cash payment. The transaction costs for acquisitions with a takeover date during the 2020 financial year totalled SEK 12.0 million (3.8) and are recognised in selling expenses.
The outcome of additional contingent considerations depends on the results achieved in the companies and has a set maximum level. The fair value of not yet paid contingent consideration for acquisitions made during the financial year is calculated to SEK 68.6 million. which is approximately 86 percent of the maximum outcome. Other relates to the option to acquire the remaining shares.
The values allocated to intangible assets, such as supplier relationships, were assessed at the discounted value of future cash flows. The amortisation period is determined by estimating the annual decrease in sales attributable to each asset. Supplier relationships are generally amortised over a period of 10 years.
The goodwill resulting from the acquisitions is attributable to expectations that the Group's position in the market in question for each acquisition will grow stronger and to the knowledge accumulated in the companies acquired.
The combined effect of the acquisitions, on consolidated net sales was SEK 508 million (20), while the combined effect on EBITA was SEK 64 million (7), operating profit was SEK 51 million (3) and after-tax profit for the year was SEK 36 million (2). Had the acquisitions, been completed on 1 January 2020, their impact would have been approximately SEK 783 million (93) on consolidated net sales, SEK 94 million (24) on EBITA, about SEK 65 million (21) on operating profit, and about SEK 46 million (16) on profit after-tax. The acquisitions were completed at an average EV/EBIT multiple of about 6 (6).