LinkedIn 2015 Annual Report Download - page 103
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presents the preliminary purchase price allocation recorded in the Company’s consolidated balance
sheets for Lynda.com as of the acquisition date (in thousands):
Preliminary
estimated
useful life
Cash .................................................... $ 136,109
Accounts receivable ......................................... 9,370
Prepaid expenses ........................................... 3,984
Other current assets ......................................... 153
Property and equipment ...................................... 16,239 3 years(5)
Goodwill(1) ................................................ 1,126,536
Definite-lived intangible assets:
Subscriber relationships—Enterprise ............................ 164,000 4 years
Subscriber relationships—Individual ............................. 57,000 2 years
Content(2) ............................................... 98,000 3 years
Developed technology ...................................... 39,000 2 years
Trade name ............................................. 1,000 1 year
Other assets .............................................. 367
Accounts payable ........................................... (8,622)
Accrued liabilities ........................................... (7,142)
Deferred revenue(3) .......................................... (46,994)
Deferred tax liabilities ........................................ (87,481)
Other long-term liabilities(3) .................................... (14,807)
Total purchase price(4) .................................... $1,486,712
(1) The goodwill represents the excess value of the purchase price over both tangible and intangible
assets acquired. The goodwill in this transaction is primarily attributable to expected operating
synergies, which include the Lynda.com talent and their production process, the Learning &
Development (‘‘L&D’’) opportunities to strengthen the skills of LinkedIn’s members, as well as the
L&D initiatives that the talent of Lynda.com and LinkedIn will jointly develop. These attributes
position the Company to be able to further expand its long-term content strategy and to realize its
vision of building the world’s first economic graph. None of the goodwill is expected to be
deductible for tax purposes.
(2) The amortization method for the content intangible asset is 50% the first year, 30% the second
year, and 20% in the third year. The remaining definite-lived intangible assets are amortized using
the straight-line method.
(3) Other long-term liabilities include $2.8 million of long-term deferred revenue. Approximately 80% of
total deferred revenue of $49.9 million is amortized in 2015 and approximately 20% thereafter.
(4) Subject to adjustment based on (i) purchase price adjustment provisions contained in the
acquisition agreement and (ii) indemnification obligations of the acquired company stockholders.
5) Represents an average estimated life.
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