Discontinued Operations (Notes)

12 Months Ended

Dec. 31, 2016

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

Discontinued Operations

Cincinnati Bell Wireless LLC ("CBW"), our former Wireless segment, provided digital wireless voice and data communications services to customers in the Company’s licensed service territory, which included Greater Cincinnati and Dayton, Ohio, and areas of northern Kentucky and southeastern Indiana. The Company’s customers were also able to place and receive wireless calls nationally and internationally due to roaming agreements the Company had with other carriers.

In the second quarter of 2014, we entered into agreements to sell our wireless spectrum licenses and certain other assets related to our wireless business, including leases to certain wireless towers and related equipment and other assets. The agreement to sell our spectrum licenses closed on September 30, 2014 for cash proceeds of $194.4 million. Prior to this date, the Company's digital wireless network utilized 50 MHz of licensed spectrum in the Cincinnati area and 40 MHz of licensed spectrum in the Dayton area, which had a carrying value of $88.2 million. Simultaneous with the close of the spectrum sale, the Company entered into a separate agreement to use certain wireless spectrum for $8.00 until we no longer provided wireless services. We ceased providing wireless service effective March 31, 2015. The fair value of the lease, which is considered a Level 3 measurement based on other comparable transactions, totaled $6.4 million and was recorded as a prepaid expense and amortized over a six month period ending March 31, 2015.

As of March 31, 2015, there were no subscribers remaining on the network and we no longer required the use of the spectrum being leased. Therefore, the $112.6 million gain on the sale of the wireless spectrum licenses, which had been previously deferred, was recognized in Income (loss) from discontinued operations, net of tax during the three months ended March 31, 2015. On April 1, 2015, we transferred certain other wireless assets to the acquirer, including leases to certain wireless towers and related equipment and other assets, which resulted in a gain of $15.9 million in the second quarter of 2015.

Wireless financial results for the twelve months ended December 31, 2016, 2015 and 2014 reported as "Income (loss) from discontinued operations, net of tax" on the Consolidated Statements of Operations are as follows:

	Twelve Months Ended
	December 31,
(dollars in millions)	2016			2015			2014
Revenue	$	—		$	4.4		$	132.8
Costs and expenses
Cost of products and services	—			12.0			66.9
Selling, general and administrative	—			2.2			19.5
Depreciation and amortization expense	—			28.6			103.4
Restructuring charges	—			3.3			16.3
Impairment of assets	—			—			7.5
Transaction costs	—			—			3.2
Gain on sale or disposal of assets	—			(0.4		)	—
Amortization of deferred gain	—			(6.5		)	(22.9		)
Total operating costs and expenses	—			39.2			193.9
Operating loss	—			(34.8		)	(61.1		)
Interest (income) expense	—			(1.7		)	2.8
Other (income) expense	(0.3		)	(2.3		)	2.2
Gain on transfer of tower lease obligations and other assets	—			15.9			—
Gain on sale of wireless spectrum licenses	—			112.6			—
Income (loss) before income taxes	0.3			97.7			(66.1		)
Income tax expense (benefit)	—			34.8			(24.0		)
Income (loss) from discontinued operations, net of tax	$	0.3		$	62.9		$	(42.1	)

Wireless liabilities presented as discontinued operations as of December 31, 2016 and December 31, 2015 are as follows:

(dollars in millions)	December 31, 2016		December 31, 2015
Current liabilities
Restructuring liability	$	—	$	4.7
Other current liabilities	—		0.7
Total current liabilities from discontinued operations	$	—	$	5.4

Restructuring liabilities were established for employee separations, lease abandonments and contract terminations charges. In 2015, restructuring charges were for tower operating leases that were abandoned. During 2014, restructuring charges included $13.1 million in contract termination charges for wireless contracts that were no longer utilized and $3.2 million in employee separation charges.

An asset impairment loss of $7.5 million was also recognized in 2014 for the write-off of certain construction-in-progress projects that were not completed due to the wind down of wireless operations.

In the fourth quarter of 2014, we repaid $22.7 million 8 ³/₈% Senior Notes due 2020 using proceeds from the sale of our wireless spectrum licenses.

Following is selected operating, investing and financing cash flow activity from discontinued operations included in Consolidated Statements of Cash Flows:

	Twelve Months Ended
	December 31,
(dollars in millions)	2016			2015			2014
Depreciation and amortization	$	—		$	28.6		$	103.4
Gain on sale of assets	—			(0.4		)	—
Impairment of assets	—			—			7.5
Deferred gain on sale of spectrum licenses	—			(112.6		)	—
Amortization of deferred gain on sale of towers	—			(6.5		)	(22.9		)
Gain on transfer of tower lease obligations and other assets	—			(15.9		)	—
Non-cash spectrum lease	—			3.2			3.2
Restructuring payments	(4.4		)	(14.5		)	(2.4		)
Capital expenditures	—			—			(6.5		)
Proceeds from sale of wireless spectrum licenses	—			—			194.4
Repayment of debt	—			(0.3		)	(23.5		)

Operating Lease Commitments

The Company's discontinued operations leased certain facilities and equipment. Operating lease expense was $1.4 million and $6.4 million, in 2015 and 2014, respectively.