Acquisitions

In accordance with ASC 805, the Company allocates the purchase price of its acquisitions to the tangible assets, liabilities and intangible assets acquired based on fair values. Any excess purchase price over those fair values is recorded as goodwill. The fair value assigned to intangible assets acquired is supported by valuations using estimates and assumptions provided by management. For certain large acquisitions, management engages an appraiser to assist in the valuation process.

2016 Acquisitions

YourCash

On October 3, 2016, the Company completed the acquisition of the capital stock of YourCash Europe Limited and its subsidiaries ("YourCash"), a U.K. based ATM operator with approximately 5,000 ATMs across the U.K., Netherlands, Belgium and Ireland. The acquisition provides the Company with additional experience and manpower in key Western European markets and a greater access to retailers in the U.K. and Netherlands.

The purchase price for YourCash was approximately $62.6 million in cash. Approximately $7.2 million of the cash consideration was placed in escrow accounts to satisfy indemnification obligations of the seller, pursuant to the terms of the purchase agreement. In addition, the agreement calls for deferred consideration of $3.2 million payable over three years at a rate of one-third per year to employee shareholders of YourCash who remain employed with us. The deferred consideration is accounted for separately from the acquisition and will be recognized as compensation over the service period.

The purchase price was allocated to the assets acquired and liabilities assumed, including identifiable intangible assets, based on their respective fair values at the date of acquisition. The valuation of the acquired net assets remains preliminary while management completes its valuation, particularly the valuation of acquired intangible assets. The revenue and earnings of YourCash for the year ended December 31, 2016 were not material nor were the historical revenue and earnings of YourCash material for the purpose of presenting pro forma information for the current or prior-year periods.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date.



(in thousands)	As of October 3, 2016
Cash and cash equivalents	$	5,223
Restricted cash	12,351
Other current assets	2,394
Property and equipment	12,514
Intangible assets	24,571
Total assets acquired	57,053

Trade accounts payable	(3,323		)
Short-term borrowings	(12,535		)
Accrued expenses and other current liabilities	(5,077		)
Deferred tax liabilities	(5,462		)
Other long-term liabilities	(475		)
Total liabilities assumed	(26,872		)

Goodwill	32,429

Net assets acquired	$	62,610

The intangible assets of YourCash are being amortized on a straight-line basis, and the estimated fair values consist of the following:



(in thousands)	Fair Value		Estimated Useful Life
Customer relationships	$	23,506	14 - 20 years
Trade names	428		2 years
Non-compete agreements	637		3 years
Total intangible assets	$	24,571

Goodwill of $32.4 million arising from the acquisition was included in the EFT Processing Segment and was attributable to expected growth opportunities in Europe. Goodwill and intangible assets associated with this acquisition are not deductible for tax purposes.

Other

During the fourth quarter of 2016, the Company completed the acquisition of Tuatara Management Limited for an insignificant amount of cash consideration. The acquisition has been accounted for as a business combination in accordance with U.S. GAAP and the results of operations have been included from the date of acquisition in the Money Transfer Segment.

2015 Acquisitions

xe Corporation

On July 2, 2015, the Company completed the acquisition of all of the capital stock of xe Corporation and its subsidiaries ("xe"). xe is a Canadian company which operates the xe.com and x-rates.com websites, providing currency-related data and international payments services. This acquisition provides Euronet an internationally recognized brand and a large Internet presence in which to offer its foreign currency products.

Under the terms of the agreement, the xe sellers received purchase consideration of $79.9 million in cash, including working capital adjustments, and 642,912 shares of Euronet common stock, with a fair value at date of acquisition of $40.1 million. Half of the common stock portion of the purchase consideration was placed in escrow at closing as security for the xe sellers' indemnification and other obligations under the purchase agreement. Any purchase consideration remaining in escrow will be released to the sellers two years following the closing date, net of any pending indemnification or other claims under the purchase agreement.

During the first quarter of 2016, the Company completed its valuation of the acquired assets and liabilities, which included an adjustment to goodwill of $3.9 million.

The following table summarizes the fair values of the assets acquired and liabilities assumed as of the acquisition date.



(in thousands)	As of July 2, 2015
Cash and cash equivalents	$	1,872
Other current assets	1,294
Intangible assets	19,269
Other long-term assets	341
Deferred tax assets	161
Total assets acquired	22,937

Trade accounts payable	(26		)
Accrued expenses and other current liabilities	(11,824		)
Other long-term liabilities	(571		)
Total liabilities assumed	(12,421		)

Goodwill	109,460

Net assets acquired	$	119,976

The intangible assets of xe are being amortized on a straight-line basis, and the estimated fair values consist of the following:



(in thousands)	Fair Value		Estimated Useful Life
Proprietary software	$	2,051	5 years
Customer relationships	13,765		8 years
Trade names	3,237		20 years
Non-compete agreements	216		3 years
Total intangible assets	$	19,269

The intangible asset amounts are expected to be deductible for income tax purposes, but the goodwill amount is not. Pro-forma results of operations, assuming this acquisition was made at the beginning of the earliest period presented, have not been presented because the effect of this acquisition was not material to the Company's results of operations. The net assets of xe and its results of operations are included in the Money Transfer Segment's results.

IME

On June 17, 2015, the Company completed the acquisition of all of the capital stock of IME (M) Sdn Bhd and certain affiliated companies ("IME"). IME is a leading Malaysian-based money transfer provider and provides the Money Transfer Segment with immediate entry into the Asian and Middle East send markets.

Under the terms of the purchase agreement, the sellers received purchase consideration of $78.9 million in cash, including estimated working capital adjustments, and 49,941 shares of Euronet common stock, with a fair value at date of acquisition of $3.0 million. A portion of the purchase consideration was placed in escrow at closing as security for the sellers' indemnification and other obligations under the purchase agreement. Any purchase consideration remaining in escrow will be released to the sellers at various defined dates over five years following the closing date, net of any pending indemnification or other claims under the purchase agreement.

In the first quarter of 2016, the Company adjusted the purchase price allocation to included a net adjustment to goodwill of $1.3 million, which resulted from a working capital adjustment and the finalization of the estimated fair value of the assets acquired and liabilities assumed as of the acquisition date.

The following table summarizes the fair values of the assets acquired and liabilities assumed as of the acquisition date.



(in thousands)	As of June 17, 2015
Cash and cash equivalents	$	33,279
Other current assets	21,566
Intangible assets	36,250
Other long-term assets	5,327
Total assets acquired	96,422

Trade accounts payable	(2,766		)
Accrued expenses and other current liabilities	(2,743		)
Settlement obligations and customer deposits	(30,540		)
Deferred tax liabilities	(9,063		)
Other long-term liabilities	(858		)
Total liabilities assumed	(45,970		)

Goodwill	31,443

Net assets acquired	$	81,895

The intangible assets of IME are being amortized on a straight-line basis, and the estimated fair values consist of the following:



(in thousands)	Fair Value		Estimated Useful Life
Customer relationships	$	35,360	8 years
Trade names	450		2 years
Non-compete agreements	440		5 years
Total intangible assets	$	36,250

None of the goodwill or intangible asset amounts are expected to be deductible for income tax purposes. Pro-forma results of operations, assuming this acquisition was made at the beginning of the earliest period presented, have not been presented because the effect of this acquisition was not material to the Company's results of operations. Additionally, the cumulative effect of the IME acquisitions was not material to the Company's results of operations. The net assets of IME and its results of operations are included in the Money Transfer Segment's results.