GNC 2009 Annual Report Download - page 91

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Table of Contents
GENERAL NUTRITION CENTERS, INC. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The following table summarizes the Company's goodwill activity.
Manufacturing/
Retail Franchising Wholesale Total
(in thousands)
Predecessor
Balance at December 31, 2006 $ 26,678 $ 53,898 $ 446 $ 81,022
Acquired franchise stores 161 — — 161
Balance at March 15, 2007 $ 26,839 $ 53,898 $ 446 $ 81,183
Successor
Balance at March 16, 2007 $ 238,296 $ 126,971 $ 209,356 $ 574,623
Purchase accounting adjustments 24,149 (9,668) (6,515) 7,966
Other adjustments 43,670 — — 43,670
Acquired franchise stores 11 — — 11
Balance at December 31, 2007 $ 306,126 $ 117,303 $ 202,841 $ 626,270
Acquired franchise stores 351 — — 351
Other adjustments (3,712) — — (3,712)
Balance at December 31, 2008 $ 302,765 $ 117,303 $ 202,841 $ 622,909
During the period from March 16, 2007 to December 31, 2007, the Company made purchase accounting adjustments, which consisted
principally of a $12.0 million pre-tax adjustment related to pre-acquisition contingencies. The remaining adjustments related to finalizing the
valuation of intangible assets and property, plant, and equipment.
During the year ended December 31, 2008 and the period from March 16, 2007 to December 31, 2007, the Company recorded adjustments
of $(3.7) million and $43.7 million related to income taxes, respectively. The adjustment for the period March 16, 2007 to December 31, 2007
was primarily due to $45.3 million in adjustments to revise deferred taxes related to the Merger. This adjustment resulted in a corresponding
increase to goodwill. The 2008 adjustment relates principally to foreign tax credits from amended federal returns.
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