Intel 2009 Annual Report Download - page 91

Table of Contents
INTEL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
During the second quarter of 2008, we completed the divestiture of our NOR flash memory business. We exchanged certain
NOR flash memory assets and certain assets associated with our phase change memory initiatives with Numonyx for a note
receivable with a contractual amount of $144 million and a 45.1% ownership interest in the form of common stock, together
valued at $821 million. We retain certain rights to intellectual property included within the divestiture. Approximately 2,500
employees of our NOR flash memory business became employees of Numonyx. STMicroelectronics contributed certain assets
to Numonyx for a note receivable with a contractual amount of $156 million and a 48.6% ownership interest in the form of
common stock. Francisco Partners paid $150 million in cash in exchange for the remaining 6.3% ownership interest in the
form of preferred stock and a note receivable with a contractual amount of $20 million. In addition, they received a payout
right that is preferential relative to the investments of Intel and STMicroelectronics. We did not incur a gain or loss upon
completion of the transaction in the second quarter of 2008, as we had recorded asset impairment charges in quarters prior to
deal closure. For further discussion, see “Note 19: Restructuring and Asset Impairment Charges.” Subsequent to the
divestiture, in the third quarter of 2008 we recorded a $250 million impairment charge on our investment in Numonyx within
gains (losses) on equity method investments. In February 2010, we signed a definitive agreement with Micron and Numonyx
under which Micron agreed to acquire Numonyx in an all-stock transaction. For further information, see “Note 11: Non-
Marketable Equity Investments.”
Note 17: Goodwill
At the end of 2009, we reorganized our business to better align our major product groups around the core competencies of
Intel architecture and our manufacturing operations. See “Note 29: Operating Segment and Geographic Information” for
further discussion. Due to this reorganization, goodwill was allocated from our prior operating segments to our new operating
segments, as shown below under “Transfers.” The allocation was based on the fair value of each business group within its
original operating segment relative to the fair value of that operating segment.
Goodwill activity for the years ended December 26, 2009 and December 27, 2008 was as follows:
During 2009, prior to our reorganization, we completed two acquisitions, including the acquisition of Wind River Systems
(see “Note 15: Acquisitions” for further discussion). Goodwill recognized from the Wind River Systems acquisition was
assigned to our Digital Enterprise Group, our Mobility Group, our Digital Home Group, and our Wind River Software Group
based on the relative expected fair value provided by the acquisition. The assignment of goodwill to our Digital Enterprise
Group, our Mobility Group, and our Digital Home Group was based on the proportionate benefits expected to be generated for
each group resulting from enhanced market presence for existing businesses.
During 2008, we completed two acquisitions that resulted in goodwill of $18 million.
80
Other Intel
Digital
Architecture
Other
Enterprise
Mobility
PC Client
Data Center
Operating
Operating
(In Millions)
Group
Group
Group
Group
Segments
Segments
Total
Goodwill, net
December 29, 2007
$
3,385
$
248
$
—
$
—
$
—
$
283
$
3,916
Additions due to
business combinations
9
—
—
—
—
9
18
Transfers
123
—
—
—
—
(
123
)
—
Other
(2
)
—
—
—
—
—
(
2
)
December 27, 2008
$
3,515
$
248
$
—
$
—
$
—
$
169
$
3,932
Additions due to
business combinations
192
142
—
—
—
155
489
Transfers
(3,707
)
(390
)
2,220
1,459
507
(89
)
—
December 26, 2009
$
—
$
—
$
2,220
$
1,459
$
507
$
235
$
4,421