BUSINESS COMBINATIONS

We acquired one business during the year ended December 31, 2018 and three businesses during the year ended December 31, 2016. For the years ended December 31, 2018 and 2016, $0.7 million and $1.6 million, of external transaction costs related to business combinations, primarily consisting of legal and advisory fees, are classified within Selling, general and administrative on the consolidated statements of operations. The results of businesses acquired are included in the consolidated financial statements beginning on the respective acquisition dates. Acquired goodwill represents the premium paid over the fair value of the net tangible and intangible assets acquired. We may pay a premium for a number of reasons, including growing our merchant base and acquiring an assembled workforce.

2018 Acquisition Activity

On April 30, 2018, we acquired 80% of the outstanding shares of Cloud Savings Company, Ltd. ("Cloud Savings"), a UK-based business that operates online discount code and digital gift card platforms. The primary purpose of this acquisition was to expand digital coupon offerings in our International segment. The transaction included a contingent consideration arrangement with an acquisition-date fair value of $1.6 million. In additional, concurrent with the acquisition, we entered into an agreement with the noncontrolling shareholder that gave us the right to acquire and the noncontrolling shareholder's right to put to us the remaining outstanding shares of Cloud Savings in December 2018. The acquisition-date fair value of the right and obligation to acquire the remaining outstanding shares of $8.6 million was initially recorded as a financing obligation and classified within Accrued expenses and other current liabilities on the consolidated balance sheets. We paid $8.4 million to exercise that right in December 2018. The aggregate acquisition-date fair value of the consideration transferred for the Cloud Savings acquisition totaled $74.6 million, which consisted of the following (in thousands):



Cash	$	64,363
Financing obligation	8,604
Contingent consideration	1,589
Total	$	74,556

The following table summarizes the allocation of the aggregate acquisition price of the Cloud Savings acquisition (in thousands). The allocation of the acquisition price has been prepared on a preliminary basis, and changes to that allocation may occur as a result of final working capital adjustments and tax return filings.



Cash and cash equivalents	$	6,244
Accounts receivable	5,885
Prepaid expenses and other current assets	804
Property, equipment and software	226
Goodwill	46,515
Intangible assets⁽¹⁾:
Merchant relationships	20,322
Trade names	2,609
Developed technology	549
Other intangible assets	687
Total assets acquired	$	83,841
Accounts payable	$	693
Accrued merchant and supplier payables	386
Accrued expenses and other current liabilities	6,130
Other non-current liabilities	2,076
Total liabilities assumed	$	9,285
Total acquisition price	$	74,556


(1)	The estimated useful lives of the acquired intangible assets are 6 years for merchant relationships, 8 years for trade names, 2 years for developed technology, and 1 year for other intangible assets.

The results of the Cloud Savings acquisition are included in our consolidated financial statements from the date of acquisition through December 31, 2018. The revenue and net income of Cloud Savings included in our consolidated statements of operations were $12.9 million and $1.1 million, for the period from April 30, 2018 through December 31, 2018. Pro forma results of operations for the Cloud Savings acquisition are not presented because the pro forma effects of that acquisition were not material to our consolidated results of operations.

2016 Acquisition Activity

LivingSocial, Inc.

On October 31, 2016, we acquired all of the outstanding equity interests of LivingSocial, Inc. ("LivingSocial"), an e-commerce company that connects merchants to consumers by offering goods and services, generally at a discount. The primary purpose of this acquisition was to grow our customer base. We acquired LivingSocial for no consideration.

The following table summarizes the assets acquired and liabilities assumed from the LivingSocial acquisition (in thousands):



Cash and cash equivalents	$	15,479
Accounts receivable	3,652
Prepaid expenses and other current assets	2,399
Property, equipment and software	1,075
Goodwill	528
Intangible assets: ⁽¹⁾
Customer relationships	16,200
Merchant relationships	2,700
Trade name	1,000
Developed technology	2,500
Other non-current assets	5,495
Total assets acquired	$	51,028
Accounts payable	$	2,184
Accrued merchant and supplier payables	18,498
Accrued expenses and other current liabilities	25,854
Other non-current liabilities	4,492
Total liabilities assumed	$	51,028
Total acquisition price	$	—


(1)	The estimated useful lives of the acquired intangible assets are 1 year for developed technology, 4 years for trade name and 3 years for merchant relationships and customer relationships.

The following pro forma information presents the combined operating results for the year ended December 31, 2016 as if we had acquired LivingSocial as of January 1, 2016 (in thousands). The underlying pro forma results include the historical financial results of us and this acquired business adjusted for depreciation and amortization expense associated with the assets acquired. The pro forma results do not reflect any operating efficiencies or potential cost savings which may result from the consolidation of the operations of us and the acquired entity. Accordingly, these pro forma results are not necessarily indicative of what the actual combined results of operations would have been if the acquisition had occurred as of January 1, 2016, nor are they indicative of future results of operations.



	Year Ended December 31, 2016
Revenue	$	3,070,431
Loss from continuing operations	(182,781		)

The revenue and net loss of LivingSocial included in our consolidated statements of operations were $9.3 million and $4.3 million, for the period from October 31, 2016 through December 31, 2016.

Other Acquisitions

We acquired two other businesses during the year ended December 31, 2016. The acquisition price of those businesses and the assets acquired and liabilities assumed were not material.