Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

White Mountains accounts for business combinations using the acquisition method. Under the acquisition method, White Mountains recognizes and measures the assets acquired, liabilities assumed and any noncontrolling interest in the acquired entities at their acquisition date fair values. The estimated acquisition date fair values, generally consisting of intangible assets and liabilities for contingent consideration, may be recorded at provisional amounts in circumstances where the information necessary to complete the acquisition accounting is not available at the reporting date. Any such provisional amounts are finalized as measurement period adjustments within one year of the acquisition date.

The following table presents a summary of the acquisition date fair values of goodwill and other intangible assets for acquisitions during the nine months ended September 30, 2019 and 2018:



$ in Millions
Acquisition of subsidiary/ asset	Goodwill and Other intangible asset			Acquisition Date
NSM	$	383.0		May 11, 2018
Fresh Insurance	54.6			May 18, 2018
KBK	59.4			December 3, 2018
Embrace	70.6		⁽¹⁾	April 1, 2019
Renewal Rights ⁽²⁾	82.5			June 28, 2019
Total NSM segment	$	650.1
Kudu Transaction	$	9.8		April 4, 2019
Other Operations	$	13.1	⁽¹⁾	March 12, 2019

⁽¹⁾ The relative fair values of goodwill and of other intangible assets recognized in connection with the acquisition of Embrace and the acquisition in Other Operations had not yet been finalized at September 30, 2019.

⁽²⁾NSM’s acquisition of the Renewal Rights was an asset purchase.

The following tables presents the change in goodwill and other intangible assets for the three and nine months ended September 30, 2019 and 2018:



	Three Months Ended September 30,
	2019									2018
Millions	Goodwill			Other Intangible Assets			Total Goodwill and Other Intangible Assets			Goodwill			Other Intangible Assets				Total Goodwill and Other Intangible Assets
Beginning balance	$	428.6		$	239.0		$	667.6		$	25.9		$	30.7			$	56.6
Attribution of acquisition date fair value estimates between goodwill and other intangible assets	(2.2		)	2.2			—			295.3			140.9				436.2
Foreign currency translation	(1.6		)	(.5		)	(2.1		)	(1.2		)	(.4		)	—	(1.6		)
Adjustments to reflect acquisition date fair value	—			—			—			1.4			—			—	1.4
Amortization	—			(4.6		)	(4.6		)	—			(7.4		)		(7.4		)
Ending balance	$	424.8		$	236.1		$	660.9		$	321.4		$	163.8			$	485.2



	Nine Months Ended September 30,
	2019										2018
Millions	Goodwill				Other Intangible Assets			Total Goodwill and Other Intangible Assets			Goodwill			Other Intangible Assets				Total Goodwill and Other Intangible Assets
Beginning balance	$	379.9			$	157.6		$	537.5		$	25.9		$	36.2			$	62.1
Deconsolidation of MediaAlpha	(18.3		)		(23.5		)	(41.8		)	—			—				—
Attribution of acquisition date fair value estimates between goodwill and other intangible assets	(29.0		)		29.0			—			295.3			140.9				436.2
Acquisitions of businesses	93.8			⁽¹⁾	—			93.8			—			—				—
Acquisition of collector car renewal rights	—				82.5			82.5			—			—				—
Foreign currency translation	(1.6		)		—			(1.6		)	(1.2		)	(.4		)	—	(1.6		)
Adjustments to reflect acquisition date fair value	—				5.9			5.9			1.4			—			—	1.4
Amortization	—				(15.4		)	(15.4		)	—			(12.9		)		(12.9		)
Ending balance	$	424.8			$	236.1		$	660.9		$	321.4		$	163.8			$	485.2

⁽¹⁾ The relative fair values of goodwill and other intangible assets recognized in connection with the acquisition of Embrace and the acquisition in Other Operations had not yet been finalized at September 30, 2019.

White Mountains evaluates goodwill for potential impairment at least annually, generally in the interim period prior to the one-year anniversary of the acquisition date. An impairment of goodwill or other intangible assets occurs when the carrying value of the asset exceeds its fair value. Between annual evaluations, White Mountains considers changes in circumstances or events subsequent to the most recent evaluation that may indicate that an impairment may exist and, if necessary will perform an interim review for potential impairment. During the second quarter of 2019, White Mountains performed a periodic review of NSM’s goodwill and other intangible assets and concluded that goodwill and other intangible assets were not impaired. There have been no changes in circumstances or events for the quarterly period ended September 30, 2019 that would indicate the existence of an impairment of goodwill or other intangible assets for any acquired entity.

The following table presents the acquisition date fair values, accumulated amortization and net carrying values for other intangible assets and goodwill, by company as of September 30, 2019 and December 31, 2018:



$ in Millions	Weighted Average Economic life (in years)	September 30, 2019							December 31, 2018
		Acquisition Date Fair Value		Accumulated Amortization		Net Carrying Value			Acquisition Date Fair Value		Accumulated Amortization		Net Carrying Value
Goodwill:
NSM ⁽¹⁾	N/A	$	397.0	$	—	$	397.0		$	354.3	$	—	$	354.3
Kudu	N/A	7.6		—		7.6			—		—		—
MediaAlpha	N/A	—		—		—			18.3		—		18.3
Other Operations ⁽²⁾	N/A	20.2		—		20.2			7.3		—		7.3
Total goodwill		424.8		—		424.8			379.9		—		379.9

Other intangible assets:
NSM ⁽¹⁾
Customer relationships	9	110.5		15.5		95.0			85.3		6.0		79.3
Trade names	19	57.1		4.2		52.9			51.2		1.8		49.4
Information technology	5	3.6		1.1		2.5			3.7		.5		3.2
Renewal rights	12	82.5		.3		82.2			—		—		—
Other	3	1.7		.7		1.0			—		—		—
Subtotal		255.4		21.8		233.6			140.2		8.3		131.9

Kudu
Trade names	7	2.2		.2		2.0			—		—		—

MediaAlpha
Customer relationships	9	—		—		—			26.8		4.9		21.9
Information technology	5	—		—		—			33.3		30.9		2.4
Other	3	—		—		—			9.8		9.0		.8
Subtotal		—		—		—			69.9		44.8		25.1

Other Operations
Trade names	7	.6		.2		.4			.6		.2		.4
Information technology	5	.4		.3		.1			.5		.3		.2
Subtotal		1.0		.5		.5			1.1		.5		.6

Total other intangible assets		258.6		22.5		236.1			211.2		53.6		157.6

Total goodwill and other intangible assets		$	683.4	$	22.5	660.9			$	591.1	$	53.6	537.5

Goodwill and other intangible assets attributed to non-controlling interests						(25.0		)					(40.6		)

Goodwill and other intangible assets included in White Mountains’s common shareholders’ equity						$	635.9						$	496.9

⁽¹⁾As of September 30, 2019, NSM’s goodwill included $(1.5) and $(2.2) of the effect of foreign currency translation. As of December 31, 2018, NSM’s intangible assets include $(0.7) of the effect of foreign currency translation.

⁽²⁾As of September 30, 2019 and December 31, 2018, Other Operations’ goodwill included $(0.1) and $(0.3) of the effect of foreign currency translation.