_382 2023 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN 5 FINANCIAL PERFORMANCE 2023 consolidated financial statements 4.1.2 EGC Entreprises On January 31, 2023, the Group acquired all outstanding shares in US company EGC Enterprises, Inc., a manufacturer of graphite-based sealing products with locations in Ohio and North Carolina. EGC products are designed for use in high-temperature and high-pressure applications in the fluid sealing, heavy equipment, aerospace and thermal management sectors. The company was fully consolidated in the first half of the year, and the purchase price allocation was completed in the second half. Following this allocation, goodwill of €18 million was recognized at December 31, 2023, as shown in the following table: (in € millions) At the acquisition date Fair value of consideration transferred 49 Consolidated net assets (31) FINAL GOODWILL 18 EGC contributed €14 million to the Group’s sales and €3 million to segment operating income for 2023. 4.1.3 Watèa Watèa offers a purpose-designed electric mobility solution for light truck fleets. In April 2023, Crédit Agricole Leasing & Factoring acquired a 30% stake in Watèa by underwriting a €31 million share issue. In light of the resulting change in its governance structure, the Group considered that Watèa had become a joint venture as of the transaction date. Its share of Watèa’s net assets was therefore remeasured at fair value at the transaction date, leading to the recognition of a €68 million positive fair value adjustment under “Other operating income and expenses” in the consolidated income statement. 4.1.4 Blacksmith The US company Blacksmith OTR LLC manufactures and markets tires for height work platforms, such as aerial work platforms and telescopic forklifts. In April 2023, the Group increased its interest in the company from 50% to 100%, at a cost of €39 million. On December 31, 2023 the Group sold all of Blacksmith’s outstanding shares for €60 million, incurring a disposal loss of €5 million. In 2023, Blacksmith was fully consolidated during the period in which it was controlled by the Group. During this period, it contributed €51 million to the Group's sales and €6 million to its segment operating income. 4.1.5 Russia Following approval from the relevant Russian authorities, the Group sold its two subsidiaries, Michelin Russian Tyre Manufacturing Company LLC (MRTMC) and Camso CIS LLC, on May 26, 2023. At December 31, 2022, an impairment loss of €139 million, corresponding to the portion of the Russian net assets that the Group believed to be unrecoverable, was recorded in “Other operating income and expenses”. At December 31, 2023, a further loss of €54 million was recorded under the same caption (note 9), corresponding for the most part to cumulative translation differences reclassified to profit or loss on disposal of the underlying net assets. 4.1.6 Other During 2023, the Group completed several other investments and acquisitions that were individually not material, representing a total investment of €39 million. The companies and controlling interests acquired contributed €6 million to consolidated sales and €0.2 million to segment operating income for the period.
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