Discontinued Operations

12 Months Ended

Dec. 31, 2015

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

2. DISCONTINUED OPERATIONS

On December 30, 2014, our Board of Directors approved a plan to sell several of our agent-based businesses. Businesses to be sold included our consumer facing customer sales and lifecycle management, account services and receivables management businesses. On January 7, 2015, we entered into a definitive agreement to sell these agent-based businesses to Alorica Inc. for approximately $275.0 million in cash. On March 3, 2015, we completed the divestiture.

Corporate overhead expenses and other shared services expenses that had previously been allocated to these business units are now included in continuing operations. These expenses for the years ended December 31, 2014 and 2013 were $18.7 million and $17.8 million, respectively, and are reflected in selling, general and administrative expenses (“SG&A”).

The following table summarizes the results of discontinued operations for the years ended December 31, 2015, 2014 and 2013 in thousands:

	2015			2014			2013
Revenue	$	102,251		$	585,866		$	573,959
Operating income		2,326			22,685			28,920
Gain on disposal		48,226			—			—
Income before income tax expense		50,553			21,625			29,019
Income tax expense (benefit)		(371	)		(2,169	)		8,908
Income from discontinued operations	$	50,924		$	23,794		$	20,111

In 2015, the divestiture resulted in a $48.2 million gain on an after tax basis which is included within income from discontinued operations. The $48.2 million gain included a $21.6 million tax benefit in 2015 due to the deferred tax benefit associated with excess outside basis over financial reporting basis. The total after tax gain realized on the sale was $56.8 million, including the $8.6 million tax benefit associated with a higher tax basis than book basis that we were required to recognize in 2014.

The following is a summary of the assets and liabilities of discontinued operations which were held for sale as of December 31, 2015 and December 31, 2014 in thousands:

	2015		2014
Assets:
Cash and cash equivalents	$	—	$	—
Trust and restricted cash		—		2,411
Accounts receivable net of allowance of $0 and $521		—		92,699
Deferred income taxes		—		8,974
Other assets		—		5,499
Property and equipment, net		17,672		38,146
Goodwill		—		152,716
Intangible and other assets		—		4,160
Total assets held for sale	$	17,672	$	304,605
Liabilities:
Accounts payable	$	—	$	19,660
Accrued expenses		—		29,249
Deferred income taxes		—		33,181
Other liabilities		—		2,698
Total liabilities held for sale	$	—	$	84,788
Net assets held for sale	$	17,672	$	219,817

On January 30, 2015, we entered into an exclusive sales listing agreement to market certain land, building and improvements which were primarily occupied by the agent businesses we later divested on March 3, 2015. The net book value of these assets is $17.7 million and the assets are presented on our December 31, 2015 consolidated balance sheet as assets held for sale and measured at the lower of their carrying amount or fair value less costs to sell. At December 31, 2015, we were in active negotiations with a prospective buyer for these properties.

We have agreed to indemnify the buyer, up to the full purchase price, with respect to the equity interests of the companies we have sold, title to the equity and assets sold and the authority of the Company to sell the equity and assets. The Company has also agreed to indemnify the buyer for breaches of other representation and warranties in the purchase agreement for up to $13.75 million in losses.