Worldline - 2019 Universal Registration Document

E

FINANCIALS Consolidated financial statements

Main changes in the scope of consolidation Note 1

Accounting policies/principles Business combination and goodwill A business combination may involve the purchase of another entity, the purchase of all the net assets of another entity or the purchase of some of the net assets of another entity that together form one or more businesses. Major services contracts involving staff and asset transfers that enable the Group to develop or significantly improve its competitive position within a business or a geographical sector are accounted for as business combinations when fulfilling the definition of a business under IFRS 3. Valuation of assets acquired and liabilities assumed of newly acquired subsidiaries Business combinations are accounted for according to the acquisition method. The consideration transferred in exchange for control of the target is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Group, liabilities incurred by the Group to the former owners of the target and the equity interests issued by the Group in exchange for control of the target. Direct transaction costs related to a business combination are charged to the income statement when incurred and presented as part of the Other Operating Income. During the first consolidation, all the assets, liabilities and contingent liabilities of the subsidiary acquired are measured at their fair value. Purchase of non-controlling interests and sale of interests in a controlled subsidiary Purchase of non-controlling interests and sale transactions of interests in a controlled subsidiary that do not change the status of control are recorded through shareholders’ equity (including direct acquisition costs). If control in a subsidiary is lost, any gain or loss is recognized in net income. Furthermore, if an investment in the entity is retained by the Group, it is re-measured to its fair value and any gain or loss is also recognized in net income.

Exercise of Worldline call option to acquire the 36.4% minority stake and take full ownership of equensWorldline The exercise, by Worldline, of the call option to acquire the 36.4% remaining minority stakes in equensWorldline constitutes the final step of the Equens acquisition initiated in 2016. The call exercise price was c. €1,070 million for the remaining 36.4% stake. Worldline Group now owns 100% of equensWorldline. (Please refer to the consolidated statement of changes in shareholder’s equity).

The transaction has been supported by a newly issued BBB/stable investment grade rating received from Standard & Poor’s and has been financed by: A 7-year c. € 600 million convertible bond dated July 30, ● 2019 (60% conversion premium, zero coupon and yield to maturity of -0.96%); and A 5-year € 500 million bond dated September 18, 2019 ● (0.25% coupon; 0.35% yield, BBB rating from Standard & Poor’s). Cf to Note 6.4 Borrowings.

The impacts of the acquisition are presented in the table below:

12 months ended December 31, 2019

(In € million)

Purchase price

1,070.8

Acquisition costs net of tax Total consideration paid

1.8

1,072.6

Non controlling interest acquired Net impact on equity group share

225.9

-846.7

SIX Payment Services

the completion of the regulatory process, the transaction with SIX Group AG was finalized on November 30, 2018. Worldline acquired 100% of SIX Payment Services which is fully consolidated since December 1, 2018.

After Worldline Extraordinary General Meeting that had approved the issuance of new Worldline shares in exchange for the contribution of SIX Payment Services to Worldline and

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Universal Registration Document 2019