Pandora 2016 Annual Report Download - page 97

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(in thousands)
Cash paid by Pandora $191,479
Cash paid by Ticketfly to option holders 7,238
Common stock (11,193,847 shares at $12.18 per share) issued by Pandora to selling shareholders 136,342
Fair value of stock options and restricted stock units assumed 10,514
Less: purchase price adjustments (6,995)
Less: post-combination compensation expense (3,235)
Purchase consideration $335,343
The $3.2 million of post-combination compensation expense (approximately 0.2 million shares of common stock and
$1.9 million in cash) is subject to continuous employment and will be recognized over the required service period of up to three
years.
The following table summarizes the estimated fair values of assets acquired and liabilities assumed as of the date of
acquisition:
(in thousands)
Current assets $39,809
Long-term assets 15,982
Current liabilities (21,853)
Long-term liabilities (6,298)
Deferred tax liability (1,738)
Intangible assets 76,800
Goodwill 232,641
Total $335,343
The fair value of assets acquired and liabilities assumed from our acquisition of Ticketfly was based on a preliminary
valuation and our estimates and assumptions are subject to change. We will recognize any subsequent adjustments to the
purchase price prospectively in the period in which the adjustments are determined. A portion of the purchase price is held in
escrow and may be recovered from this escrow amount. The primary areas of the purchase accounting that are not yet finalized
are estimated liabilities for taxes and other liabilities totaling $7.0 million. We have recorded a receivable in the amount of $7.0
million related to these liabilities, as we expect to recover any amounts required to be paid by us from the escrow amount.
The following unaudited pro forma information presents the combined results of operations as if the acquisition had
been completed on January 1, 2014, the beginning of the comparable prior annual reporting period. The unaudited pro forma
results include: (i) amortization associated with preliminary estimates for the acquired intangible assets; (ii) recognition of the
post-combination compensation expense; and (iii) share-based compensation expense related to the€RSUs and options granted
to Ticketfly employees.
The unaudited pro forma results do not reflect any cost saving synergies from operating efficiencies or the effect of the
incremental costs incurred in integrating the two companies. Accordingly, these unaudited pro forma results are presented for
informational purpose only and are not necessarily indicative of what the actual results of operations of the combined company
would have been if the acquisition had occurred at the beginning of the period presented, nor are they indicative of future
results of operations:
Twelve Months Ended€
€December 31,
2014 2015
(in thousands)
Revenue $975,712 $1,222,452
Net loss $(58,195) $ (210,111)
Rdio, Inc. ("Rdio")
Table of Contents
Pandora Media,€Inc.
86