Business combinations, goodwill and non-controlling interests
On 1 January 2026 Halden Co acquired 80% of the equity shares of Ingleby Co. It paid $40m in cash on that date and will pay a further $11.025m in cash on 1 January 2028. Halden Co's cost of capital is 5% a year. Halden Co also paid legal fees of $1.2m on the acquisition.
The carrying amount of Ingleby Co's net assets on 1 January 2026 was $45m. Their fair values equalled their carrying amounts except for land, whose fair value was $6m above its carrying amount. Ingleby Co also faced a legal claim that it had not recognised because an outflow was not probable; the claim is a present obligation arising from a past event and its fair value on 1 January 2026 was $2m.
Halden Co plans to close one of Ingleby Co's factories in 2027 at a cost of $3m; Ingleby Co had no obligation to do so on 1 January 2026. Halden Co measures the non-controlling interest at fair value, which was $13m on 1 January 2026. Ignore deferred tax.
What is the goodwill arising on the acquisition of Ingleby Co, in $m to one decimal place? (2 marks)