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Acquisitions
6 Months Ended
Jun. 30, 2016
Business Combinations [Abstract]  
Acquisitions
NOTE 2: ACQUISITIONS
2015 Acquisitions
In May 2015, the Company completed the acquisitions of all issued and outstanding equity interests in Infostrada Statistics B.V. (“Infostrada Sports”), SportsDirect Inc. (“SportsDirect”) and Covers Media Group (“Covers”). In conjunction with these acquisitions, the Company launched Gracenote Sports, which is a part of the Digital and Data segment’s product offerings. Infostrada Sports and SportsDirect provide the Company with in-depth sports data, including schedules, scores, play-by-play statistics, as well as team and player information for the major professional leagues around the world, including the National Football League, Major League Baseball, National Basketball Association, National Hockey League, European Football League, and the Olympics. Covers is the operator of Covers.com, a North American online sports gaming destination for scores, odds and matchups, unique editorial analysis, and industry news coverage. In May 2015, the Company also completed an acquisition of all issued and outstanding equity interests in Enswers Inc. (“Enswers”), a leading provider of automatic content recognition technology and systems based in South Korea, which expanded the Digital and Data segment’s product offerings. The total acquisition price for Infostrada Sports, SportsDirect, Covers and Enswers was $70 million, net of cash acquired.
The purchase prices for the above acquisitions were allocated to the tangible and intangible assets acquired and liabilities assumed. The excess of the fair values and the related deferred taxes were allocated to goodwill, which will not be deductible for tax purposes due to the acquisitions being stock acquisitions. In connection with these acquisitions, the Company incurred a total of $3 million of transaction costs, which were recorded in selling, general and administrative expenses in the Company’s unaudited Condensed Consolidated Statements of Operations.
The total purchase price for the Infostrada Sports, SportsDirect, Covers and Enswers acquisitions assigned to the acquired assets and assumed liabilities of these companies is as follows (in thousands):
Consideration:
 
Cash
$
71,768

Less: cash acquired
(1,919
)
Net cash
$
69,849

 
 
Allocated Fair Value of Acquired Assets and Assumed Liabilities:
 
Restricted cash and cash equivalents
$
404

Accounts receivable and other current assets
2,481

Property and equipment
805

Deferred tax assets
3,816

Other long term assets
157

Intangible assets subject to amortization
 
     Customer relationships (useful lives of 6 to 16 years)
17,000

     Content databases (useful lives of 10 to 16 years)
13,900

     Technologies (useful lives 4 to 10 years)
6,900

     Trade name and trademarks (useful life of 15 years)
5,200

     Non-competition agreement (useful life 5 years)
1,100

Accounts payable and other current liabilities
(1,507
)
Deferred revenue
(339
)
Deferred tax liabilities
(10,097
)
Other liabilities
(477
)
Total identifiable net assets
39,343

Goodwill
30,506

Total net assets acquired
$
69,849


The allocation presented above is based upon management’s estimate of the fair values using income, cost, and market approaches. In estimating the fair value of acquired assets and assumed liabilities, the fair value estimates are based on, but not limited to, expected future revenue and cash flows, expected future growth rates and estimated discount rates. The definite-lived intangible assets will be amortized over a total weighted average period of 12 years that include weighted average periods of 11 years for customer relationships, 14 years for content databases, 8 years for technologies, 15 years for trade name and trademarks, and 5 years for non-competition agreements. The acquired property and equipment will be depreciated on a straight-line basis over the respective estimated remaining useful lives. Goodwill is calculated as the excess of the consideration transferred over the fair value of the identifiable net assets acquired and represents the future economic benefits expected to arise from other intangible assets acquired that do not qualify for separate recognition, including assembled workforce, and noncontractual relationships, as well as expected future cost and revenue synergies.