Discontinued Operations, Sale Of Assets And Assets Held For Sale

9 Months Ended

Sep. 30, 2011

Discontinued Operations, Sale Of Assets And Assets Held For Sale [Abstract]

Discontinued Operations, Sale Of Assets And Assets Held For Sale

NOTE 3: DISCONTINUED OPERATIONS, SALE OF ASSETS AND ASSETS HELD FOR SALE

Money Transfer Business (the "Money Transfer Business")

On June 9, 2011, we completed the sale transaction of our Money Transfer Business to Sigue Corporation ("Sigue"). We received $19.5 million in cash and a note receivable of $29.5 million (the "Sigue Note"). In addition, we may be required to provide an additional loan to Sigue for up to $5.0 million with terms consistent with the Sigue Note if Sigue is required to meet certain regulatory requirements with respect to available bank deposits within 18 months following the closing of the transaction. See Note 14: Fair Value for additional details about the Sigue Note.

We estimated the fair value of the Sigue Note at approximately $21.0 million, which was based on the discounted cash flows of the future note payments and was not an exit price based measure of fair value or the stated value on the face of the Sigue Note. The discount rate used in our fair value estimate was the market rate for similar risk profile companies and represented our best estimate of default risk. During the third quarter and year to date periods ended September 30, 2011, we recognized $0.9 million of interest income base on the imputed interest rate of the Sigue Note.

Electronic Payment Business (the "E-Pay Business")

On May 25, 2010, we sold our subsidiaries comprising our E-Pay Business to InComm Holdings, Inc. and InComm Europe Limited (collectively "InComm") for an aggregate purchase price of $40.0 million. In addition, the purchase price was subject to a post-closing net working capital adjustment in the amount of $0.5 million, which was finalized in October 2010.

Summary Financial Information

The disposition and operating results of the Money Transfer Business and E-Pay Business are presented in discontinued operations in our Consolidated Statements of Net Income for all periods presented. The continuing cash flows from both the Money Transfer Business and the E-Pay Business after disposition are expected to be insignificant.

The following table sets forth the components of discontinued operations included in our Consolidated Statements of Net Income:

		Three Months Ended   September 30,							Nine Months Ended     September 30,
Dollars in thousands		2011			2010				2011				2010
Revenue:
Money Transfer Business	$		-	$		24,346		$		47,716		$		69,985
E-Pay Business			-			-				-				8,732
	$		-	$		24,346		$		47,716		$		78,717
Pre-tax gain (loss) from discontinued operations:
Money Transfer Business	$		-	$		(4,011	)	$		654		$		(9,459	)
E-Pay Business			-			-				-				(132	)
	$		-	$		(4,011	)	$		654		$		(9,591	)
Gain (loss) on disposal activities:
Money Transfer Business	$		-	$		(967	)	$		(11,070	)	$		(13,170	)
E-Pay Business			-			-				-				12,184
	$		-	$		(967	)	$		(11,070	)	$		(986	)
Loss from discontinued operations before income tax	$		-	$		(4,978	)	$		(10,416	)	$		(10,577	)
Income tax (expense) benefit			-			3,084				(652	)			6,412
Loss from discontinued operations, net of tax	$		-	$		(1,894	)	$		(11,068	)	$		(4,165	)
Amount of goodwill and other intangible assets disposed	$		-	$		-		$		8,037		$		9,100

Included in income tax expense from discontinued operations for the nine months ended September 30, 2011, was $4.1 million related to the estimated current value of a worthless stock deduction taken in 2009 in connection with our divestiture of the entertainment business, which was sold in the third quarter of 2009.

On June 9, 2011, the disposed assets and liabilities of the Money Transfer Business primarily consisted of the following (in thousands):

Dollars in thousands		June 9, 2011
Cash and cash equivalents	$		57,893
Accounts receivable, net			33,185
Other current assets			13,560
Property, plant and equipment, net			4,066
Goodwill, intangible, and other assets			8,162
Total assets			116,866
Accounts payable and payable to agents			65,464
Accrued liabilities			13,062
Total liabilities			78,526
Net assets sold	$		38,340

The net assets sold represent the fair value less cost to sell of the Money Transfer Business. The loss on disposal activities recognized during the nine months ended September 30, 2011 was allocated to the asset disposal group including property, plant and equipment, net, goodwill, and intangible and other assets.