[25] Financial liabilities Audited

This item comprises:

Credit facilities granted to the Merck Group are as follows:

The current and non-current liabilities of the Merck Group to banks are denominated in the following currencies:

In fiscal 2007, a € 2 billion multi-currency term loan and revolving credit facility was agreed. The loan has a term of seven years and was agreed with an international banking syndicate.

In 2009, Merck set up a debt issuance program that forms the contractual basis for the issue of bonds with a nominal volume of up to € 5 billion. Within the scope of this program, in 2009 Merck Financial Services GmbH, launched a euro benchmark bond in the European debt capital market. The issue volume of the bond, which has a maturity of 4.5 years and pays a coupon of 4.875% , was € 750 million. It was issued at a price of 99.697%.

In addition, under the debt issuance program, we made three private placements via Merck Financial Services GmbH. With a transaction volume of € 60 million and a maturity of seven years, the issue price of the first transaction was 100%. It pays a coupon of 4.000%. The transaction volume of the second bond was € 70 million. It has a maturity of ten years and pays a coupon of 4.250%. The third bond has a volume of € 100 million, a maturity of six years and an issue price of 100%. For this transaction, a variable coupon equivalent to the three-month Euribor +0.77% was agreed. The variable interest expense of the bond has been fixed via an interest rate swap. The bond is carried at amortized cost taking into account the transaction costs.

In 2007, Merck KGaA launched a euro Benchmark Bond for € 500 million in the European debt capital market. It has a maturity of three years. The bond pays a coupon of 4.75% and was issued at a price of 99.7%. It is carried at amortized cost.

In 2005, Merck KGaA launched its first euro Benchmark Bond in the European debt capital market via Merck Finanz AG, Luxembourg. The size of the issue was € 500 million with a maturity of seven years. The bond pays a coupon of 3.75% and was issued at a price of 99.716%. The interest expense of the bond has been variabilized to the six-month Euribor through interest rate swaps. Since the hedging instruments are based on the same fundamentals that determine the value of the underlying transaction, changes in the market interest rates lead to opposite changes in the value of the bond. The bond is carried at fair value taking into account disagios and transaction costs. The costs of issuing the bond are reflected in the book value and are distributed evenly over the term of the bond.

In order to meet short-term capital requirements, Merck KGaA issued a commercial paper program with a volume of € 2 billion, which had not been utilized as of the reporting date.

Liabilities from financial leasing represent the discounted amount of future payments arising from finance leases. This item primarily relates to liabilities from finance leases for buildings. Information on liabilities due to related parties can be found in Note [47] Related-party disclosures.