Big Lots 2011 Annual Report Download - page 185

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BIG LOTS, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 11 — Acquisition
On July 18, 2011, the Company completed its acquisition of Liquidation World Inc. Under the terms of our
acquisition agreement, we invested approximately $1.9 million in cash to purchase all outstanding shares
of Liquidation World Inc. As part of the acquisition, we assumed the liabilities and acquired all assets and
leasehold rights of Liquidation World Inc.
On July 19, 2011, we changed the name of Liquidation World Inc. to Big Lots Canada, Inc. (“Big Lots Canada”).
Based in Brantford, Ontario, Big Lots Canada offers a broad assortment of closeout merchandise. At January
28, 2012, Big Lots Canada operated 82 stores in Canada.
The results of Big Lots Canada since the acquisition date are included in our consolidated financial statements.
The acquisition is immaterial to our operations as a whole and therefore no proforma disclosure of financial
information has been presented. The following table summarizes the preliminary allocation of the purchase
price to the fair value of the assets acquired and liabilities assumed based on the exchange rate in effect at the
date of our acquisition of Big Lots Canada.
Preliminary
Allocation Revisions Allocation As Revised
(in thousands)
Financial assets ............................................ $ 3,149 $ 715 $ 3,864
Inventory ................................................. 7,299 1,568 8,867
Other current assets ......................................... 2,278 184 2,462
Property and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,172 (344) 9,828
Goodwill ................................................. 21,507 (8,780) 12,727
Other intangibles ........................................... 1,285 1,308 2,593
Debt ..................................................... (16,664) — (16,664)
Accounts payable and accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . (27,157) 5,349 (21,808)
$ 1,869 $ 1,869
As discussed in note 9, and based on the weight of currently available evidence, we have fully reduced the
provisional amount of the acquired net deferred income tax assets (including a net operating loss carryforward)
of $16.2 million by a valuation allowance.
Other intangibles consist of tradename and lease assets and liabilities, which are amortized over periods up to
11.2 years.
NOTE 12 – Goodwill
The changes in the carrying amount of goodwill, which is generally not deductible for income tax purposes, for
the year-to-date 2011 were as follows:
(in thousands)
Balance at January 29, 2011 ................................. $ —
Goodwill from acquisition ................................ 21,507
Goodwill adjustments.................................... (8,780)
Foreign currency impact.................................. (445)
Balance at January 28, 2012 ................................. $12,282
The goodwill from acquisition was the result of our acquisition of Liquidation World Inc. in the second quarter
of 2011.