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61
about fair value of assets and liabilities becomes available, including additional information relating to tax matters and
finalization of our valuation of identified intangible assets.
The significant classes of assets and liabilities to which we preliminarily allocated the purchase price were goodwill of
$1.8 billion and identifiable intangible assets of $928 million, primarily marketing-related (trade names). The goodwill
recognized in connection with the acquisition is primarily attributable to anticipated synergies from future growth, and
is not expected to be deductible for tax purposes. We assigned the goodwill to our Devices and Consumer (“D&C”)
Other segment. Identifiable intangible assets were assigned a total weighted-average amortization period of 6.3
years. Mojang has been included in our consolidated results of operations since the acquisition date.
Nokia’s Devices and Services Business
On April 25, 2014, we acquired substantially all of Nokia Corporation’s (“Nokia”) Devices and Services business
(“NDS”) for a total purchase price of $9.4 billion, including cash acquired of $1.5 billion (the “Acquisition”). The
purchase price consisted primarily of cash of $7.1 billion and Nokia’s repurchase of convertible notes of $2.1 billion,
which was a non-cash transaction, and liabilities assumed of $0.2 billion. The Acquisition was expected to accelerate
the growth of our D&C business through faster innovation, synergies, and unified branding and marketing.
The allocation of the purchase price to goodwill was completed as of March 31, 2015. The major classes of assets
and liabilities to which we have allocated the purchase price were as follows:
(In millions)
Cash $1,506
Accounts receivable (a) 754
Inventories 544
Other current assets 936
Property and equipment 981
Intangible assets 4,509
Goodwill (b) 5,456
Other 221
Current liabilities (4,575)
Long-term liabilities (890)
Total purchase price $ 9,442
(a) Gross accounts receivable was $901 million, of which $147 million was expected to be uncollectible.
(b) Goodwill was assigned to our Phone Hardware segment. The goodwill was primarily attributed to increased
synergies that were expected to be achieved from the integration of NDS.
Following are the details of the purchase price allocated to the intangible assets acquired:
(In millions) Amount
Weighted
Average Life
Technology-based $ 2,493 9 years
Contract-based 1,500 9 years
Customer-related 359 3 years
Marketing-related (trade names) 157 2 years
Fair value of intangible assets acquired $ 4,509 8 years
During the fourth quarter of fiscal year 2015, we recorded $7.5 billion of goodwill and asset impairment charges
related to our Phone Hardware business. These costs are included in impairment, integration, and restructuring
expenses in our consolidated income statement. See Note 10 – Goodwill and Note 11 – Intangible Assets for
additional details.
Our consolidated income statement for fiscal year 2014 included revenue and operating loss of $2.0 billion and $692
million, respectively, attributable to NDS since the Acquisition.