Morgan Stanley 2009 Annual Report Download - page 137

MORGAN STANLEY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following table summarizes the preliminary allocation of the purchase price to the net assets of Smith
Barney as of May 31, 2009 (dollars in millions).
Total fair value of consideration transferred ............................................... $ 6,087
Total fair value of non-controlling interest ................................................ 3,973
Total fair value of Smith Barney(1) ...................................................... 10,060
Total fair value of net assets acquired .................................................... 4,850
Preliminary acquisition-related goodwill(2) ............................................... $ 5,210
(1) Total fair value of Smith Barney is inclusive of control premium.
(2) Goodwill is recorded within the Global Wealth Management Group business segment. The Company is currently evaluating the amount
of goodwill deductible for tax purposes.
Condensed statement of assets acquired and liabilities assumed. The following table summarizes the
preliminary fair values of the assets acquired and liabilities assumed as of the acquisition date. The allocation of
the purchase price is preliminary and subject to further adjustment as the valuation of certain intangible assets is
still in process.
At May 31, 2009
(dollars in millions)
Assets
Cash and due from banks .............................................. $ 895
Financial instruments owned ........................................... 22
Receivables ......................................................... 1,891
Intangible assets ..................................................... 4,480
Other assets ......................................................... 719
Total assets acquired .............................................. $8,007
Liabilities
Financial instrument sold, not yet purchased ............................... $ 76
Long-term borrowings ................................................ 2,320
Other liabilities and accrued expenses .................................... 761
Total liabilities assumed ........................................... $3,157
Net assets acquired ............................................... $4,850
In addition, the Company recorded a receivable of approximately $1.1 billion relating to the fair value of the
Smith Barney delayed contribution businesses as of May 31, 2009 from Citi. Such amount is presented in the
consolidated statements of financial condition as a reduction from Non-controlling interests.
Amortizable intangible assets included the following as of May 31, 2009:
At May 31, 2009 Estimated useful life
(dollars in millions) (in years)
Customer relationships ......................................... $4,000 16
Research .................................................... 176 5
Intangible lease asset .......................................... 24 1-10
Total ................................................... $4,200
The Company also recorded an indefinite-lived intangible asset of approximately $280 million related to the
Smith Barney trade name.
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