Acquisitions, Divestitures and Exchanges (Tables)

9 Months Ended

Sep. 30, 2013

Business Combination

Acquisitions, Divestitures and Exchanges

	U.S. Cellular acquisitions during the nine months ended September 30, 2013 and 2012 and the allocation of the purchase price for these acquisitions were as follows:
				Allocation of Purchase Price
		Purchase Price		Goodwill		Licenses		Intangible Assets Subject to Amortization		Net Tangible Assets/(Liabilities)
(Dollars in thousands)
2013
Licenses		$	16,540	$	-	$	16,540	$	-	$	-
2012
Licenses		$	57,957	$	-	$	57,957	$	-	$	-

Divestiture Financial Impacts

Business divestiture financial impacts

(Dollars in thousands)			Expected Period of Recognition		Projected Range				Cumulative Amount Recognized as of September 30, 2013		Actual Amount Recognized Nine Months Ended September 30, 2013		Actual Amount Recognized Three Months Ended September 30, 2013
(Gain) loss on sale of business and other exit costs, net
	Proceeds from Sprint
		Purchase price		2013	$	(480,000)	$	(480,000)	$	(480,000)	$	(480,000)	$	-
		Sprint Cost Reimbursement		2013-2014		(120,000)		(160,000)		(4,221)		(4,221)		(4,213)
	Net assets transferred			2013		213,593		213,593		213,593		213,593		-
	Non-cash charges for the write-off and write-down of property under construction and related assets			2012-2013		10,000		14,000		10,726		54		(27)
	Employee related costs including severance, retention and outplacement			2012-2014		15,000		20,000		15,071		2,462		(641)
	Contract termination costs			2012-2014		125,000		175,000		18,840		18,781		2,176
	Transaction costs			2012-2013		4,000		6,000		5,218		4,081		362
		Total (Gain) loss on sale of business and other exit costs, net			$	(232,407)	$	(211,407)	$	(220,773)	$	(245,250)	$	(2,343)
Depreciation, amortization and accretion expense
	Incremental depreciation, amortization and accretion, net of salvage values			2012-2014		175,000		210,000		154,058		134,000		45,676
(Increase) decrease in Operating income					$	(57,407)	$	(1,407)	$	(66,715)	$	(111,250)	$	43,333

		As a result of the transaction, U.S. Cellular recognized the following amounts in the Consolidated Balance Sheet:
					Nine Months Ended September 30, 2013
(Dollars in thousands)			Balance December 31, 2012		Costs Incurred		Cash Settlements (1)		Adjustments (2)		Balance September 30, 2013
Accrued compensation
	Employee related costs including severance, retention, outplacement		$	12,305	$	6,750	$	(11,460)	$	(4,288)	$	3,307
Other current liabilities
	Contract termination costs		$	30	$	12,201	$	(6,561)	$	-	$	5,670
Other deferred liabilities and credits
	Contract termination costs		$	-	$	7,246	$	(1,488)	$	-	$	5,758
(1)		Cash settlement amounts are included in either the Net income or changes in Other assets and liabilities line items as part of Cash flows from operating activities on the Consolidated Statement of Cash Flows.
(2)		Adjustment to liability represents changes to previously accrued amounts.

Assets and liabilities held for sale

		At September 30, 2013 and December 31, 2012, the following assets and liabilities were classified in the Consolidated Balance Sheet as "Assets held for sale" and "Liabilities held for sale":
			Current Assets		Licenses		Goodwill		Property, Plant and Equipment		Loss on Assets Held for Sale (1)		Total Assets Held for Sale		Liabilities Held for Sale (2)
(Dollars in thousands)
September 30, 2013
Divestiture of Missouri Market (3)			$	726	$	2,909	$	669	$	3,179	$	(1,607)	$	5,876	$	471
Divestiture of Spectrum Licenses (4)				-		72,537		-		-		-		72,537		-
	Total		$	726	$	75,446	$	669	$	3,179	$	(1,607)	$	78,413	$	471
December 31, 2012
Divestiture Transaction			$	-	$	140,599	$	72,994	$	-	$	-	$	213,593	$	19,594
Bolingbrook Customer Care Center (5)				-		-		-		4,275		(1,105)		3,170		-
	Total		$	-	$	140,599	$	72,994	$	4,275	$	(1,105)	$	216,763	$	19,594
(1)		Loss on assets held for sale was recorded in (Gain) loss on sale of business and other exit costs, net in the Consolidated Statement of Operations.
(2)		Liabilities held for sale primarily consisted of Customer deposits and deferred revenues.
(3)		On May 15, 2013, U.S. Cellular entered into an agreement with a third party to sell the subscribers, spectrum and the network assets for a Missouri market.
(4)		U.S. Cellular and/or its consolidated VIEs entered into agreements with third parties to sell unbuilt licenses in Mississippi Valley; St. Louis, MO; South Bend-Mishawaka, IN and Jackson, MI.
(5)		Effective January 1, 2013, U.S. Cellular transferred its Bolingbrook Customer Care Center operations to an existing third party vendor.