NOTE 5 – OTHER INTANGIBLE ASSETS

The following table summarizes the other intangible assets movement year on year:


	Nine Months Ended September 30
(in millions)	2013			2012
Gross cost at January 1	$	106.2		$	51.2
Capitalization of internally developed software and other costs		9.0			6.4
Acquisitions		33.7			0.0
Exchange effect		0.1			0.2

Gross cost at September 30		149.0			57.8

Accumulated amortization at January 1		(37.6	)		(33.5	)
Amortization expense		(6.6	)		(3.1	)
Exchange effect		0.0			(0.2	)

Accumulated amortization at September 30		(44.2	)		(36.8	)

Net book amount at September 30	$	104.8		$	21.0

Chemsil and Chemtec

On August 30, 2013, the Company acquired 100% of the voting equity interests in Chemsil and Chemtec. Subject to finalization of the purchase price allocation and related valuation process we have provisionally allocated $33.7 million of the purchase price to other intangible assets which we are amortizing on a straight-line basis to the income statement over an estimated weighted average expected life of 9 years. These intangible assets principally relate to product rights and an amortization expense of $0.3 million was recognized in administrative expenses since the acquisition date (2012 – $0.0 million).

Strata

On December 24, 2012, the Company acquired 100% of the voting equity interests in Strata. We have allocated $48.0 million of the purchase price to other intangible assets which we are amortizing on a straight-line basis to the income statement over a weighted average expected life of 13.1 years. These intangible assets comprise the following:

•

technology ($18.3 million) being amortized straight-line over 16.5 years. In the first nine months of 2013 amortization expense of $0.8 million was recognized in cost of goods sold (2012 – $0.0 million).

•

customer relationships ($28.2 million) and a non-compete agreement ($1.5 million) being amortized straight-line over 11.5 years and 2.0 years, respectively. In the first nine months of 2013 amortization expenses of $1.8 million and $0.6 million were recognized in selling, general and administrative expenses, respectively (2012 – $0.0 million and $0.0 million, respectively).

Internally developed software and other costs

We are continuing with the implementation of a new, company-wide, information system platform. At September 30, 2013, we had capitalized $19.1 million (2012 – $9.5 million) in relation to this internally developed software. No amortization expense was recognized in the first nine months of 2013 (2012 – $0.0 million).

Others

The remaining intangible assets of $48.2 million relate to those recognized in the acquisition accounting in respect of technology, customer relationships and patents; and sales and marketing agreements to market and sell tetra ethyl lead (“TEL”). These assets are being amortized straight-line over periods of up to 13 years. In the first nine months of 2013 amortization expenses of $2.0 million and $1.1 million were recognized in cost of goods sold and selling, general and administrative expenses, respectively (2012 – $2.0 million and $1.1 million, respectively).