2001-12-31_REPORT - M2002004 - Laserfiche WebLink

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Acquisitions, spin-offs and mergers During the year ended December 31, 2ooi, the subsidiaries GCC Holding Company, LLC. and GCC Hungary Group Financing Ltd. were incorporated, primarily to promote, organize and manage all types of companies. On April 11, 2001 Grupo Cementos de Chihuahua, S.A. de C.V. finalized the purchase of the assets of Dacotah Cement through the subsidiary GCC Dacotah, Inc. The Company paid a total of approximately USD 184.0 million for USD 2.9 million in accounts receivable, USD 23.2 million in inventories, USD 122.3 million in fixed assets, USD 38 million in goodwill, USD 1.9 million in other assets and USD 4.5 million in other liabilities. During the year Grupo Cementos de Chihuahua, S.A. de C.V. and some of its subsidiaries acquired all the outstanding common stock of GCC Tecnologia y Materiales, S.A. de C.V., a company engaged in marketing cement and aggregates, providing information technology services and promoting Investments in affiliated companies. In March and June 2001, the following subsidiaries were spun off: Entity created in spin off Transferring entity GCC Chihuahua, S.A. de C.V. Materiales Industriales de Chihuahua, S.A. de C.V. Transportes Sacramento, S.A. de C.V. Transportadora Raramuri, S.A. de C.V. in July and December 2001, the following companies were merged: Disappearing company Surviving company Vin Concreto de Chihuahua, S.A. de C.V. Concretos Premezclados de Chihuahua, S.A. de C.V. Transportes Sacramento, S.A. de C.V. Transportes del Chuviscar, S.A. de C.V. On May 26,2ooo Grupo Cementos de Chihuahua, S.A. de C.V. and some of its subsidiaries acquired all the outstanding common stock of GCC Inversiones y Comercializaci6n, S.A. de C.V., a company engaged in the marketing of cement and in promoting investments in affiliated companies. incorporation of foreign subsidiaries In conformity with Mexican accounting principles Bulletin B-15, Transactions In Foreign Currency and Translation of Financial Statements of Foreign Operations, the financial statements of foreign subsidiaries have been incorporated into the consolidated financial statements as follows: • The transactions of foreign subsidiaries are considered an entity. _.- • The financial statements were restated at December 31, 2ooi based on the U.S. consumer price index (CPI). The current year monetary effect was determined based on the annual inflation factor derived from the CPI. • Balance sheet and income statement accounts were translated using the prevailing exchange rate at the end of the year. Translation adjustments are reflected in a separate stockholders' equity caption known as "Effect of translation of foreign subsidiaries". • Exchange differences from financing contracts for the acquisition of subsidiaries abroad is presented under the caption "Effect of translation of foreing subsidiaries", taking into consideration investment in such subsidiaries as equivalent to hedges. • The monetary position gain or loss derived from financing is determined using the price index in the subsidiary's own country since it is considered an integral part of the equity investment abroad. Such gain or loss is recorded in the account "Effect of translation of foreign subsidiaries". • Goodwill derived from the acquisition of foreign subsidiaries is recorded in the currency in which the equity investment is denominated since it is the currency in which the goodwill is expected to be recovered. Goodwill is reexpressed based on the rate of inflation in the country in which the subsidiary is located and the prevailing exchange rate at the balance sheet date.