Rogers 2011 Annual Report Download - page 107

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
provider that delivers next generation and leading edge services,
to small and medium sized businesses, including municipalities,
universities, schools and hospitals, in the Oakville, Milton and
Mississauga, Ontario areas. The acquisition was accounted for
using the acquisition method in accordance with IFRS 3 with the
results of operations consolidated with those of the Company
effective January 29, 2010. The transaction costs related to the
acquisition amounted to approximately $1 million and were
charged to integration and restructuring expenses.
The fair values of the assets acquired and liabilities assumed,
which were finalized during 2010, are as follows:
Fair value of consideration transferred $ 131
Current assets $ 3
PP&E 35
Customer relationships 40
Current liabilities (2)
Deferred tax liabilities (11)
Fair value of net identifiable assets acquired and
liabilities assumed 65
Goodwill $ 66
The goodwill was allocated to the RBS reporting segment and is
not tax deductible.
The customer relationships are being amortized over a period of
5 years.
(ii) Cityfone Telecommunications Inc.:
On July 9, 2010, the Company closed an agreement to acquire all
of the assets of Cityfone Telecommunications Inc. (“Cityfone”)
for cash consideration of $26 million. Cityfone is a Canadian
Mobile Virtual Network Operator and offers postpaid wireless
voice and data services to subscribers through private label
programs with major Canadian brands. The acquisition was
accounted for using the acquisition method in accordance with
IFRS 3 with the results of operations consolidated with those of
the Company effective July 9, 2010.
The fair values of the assets acquired and liabilities assumed,
which were finalized during 2010, are as follows:
Fair value of consideration transferred $ 26
Current assets $ 3
PP&E 1
Customer relationships 17
Current liabilities (1)
Fair value of net identifiable assets acquired and
liabilities assumed 20
Goodwill $ 6
The goodwill was allocated to the Wireless reporting segment
and is tax deductible.
The customer relationships are being amortized over a period of
5 years.
(iii) Kincardine Cable T.V. Ltd.:
On July 30, 2010, the Company closed an agreement to acquire
all of the assets of Kincardine Cable T.V. Ltd. (“Kincardine”) for
cash consideration of $20 million. Kincardine provides cable
television and Internet services in Kincardine, Ontario and the
surrounding area. The acquisition was accounted for using the
acquisition method in accordance with IFRS 3 with the results of
operations consolidated with those of the Company effective
July 30, 2010.
The fair values of the assets acquired and liabilities assumed,
which were finalized during 2010, are as follows:
Fair value of consideration transferred $ 20
PP&E $ 2
Customer relationships 9
Current liabilities (1)
Fair value of net identifiable assets acquired and
liabilities assumed 10
Goodwill $ 10
The goodwill was allocated to the Cable Operations reporting
segment and is tax deductible.
The customer relationships are being amortized over a period of
3 years.
(iv) BV! Media Inc:
On October 1, 2010, the Company closed an agreement to
purchase 100% of the outstanding common shares of BV! Media
Inc. (“BV! Media”) for cash consideration of $24 million. BV!
Media is a Canadian Internet advertising network and publisher
of news and information portals. The acquisition was accounted
for using the acquisition method in accordance with IFRS 3 with
the results of operations consolidated with those of the
Company effective October 1, 2010.
During the year ended December 31, 2011, the Company
updated its valuation of certain net identifiable assets acquired
for the BV! Media acquisition. This resulted in an increase in
customer relationships of $2 million and a corresponding
decrease in goodwill of $2 million from the amounts recorded
and disclosed at December 31, 2010.
The final fair values of the assets acquired and liabilities assumed
in the acquisition are as follows:
Fair value of consideration transferred $ 24
Current assets $ 5
PP&E 4
Customer relationships 8
Current liabilities (3)
Deferred tax liabilities (3)
Fair value of net identifiable assets acquired and
liabilities assumed 11
Goodwill $ 13
The goodwill was allocated to the Media reporting segment and
is not tax deductible.
The customer relationships are being amortized over a period of
2 years.
8. INTEGRATION, RESTRUCTURING AND
ACQUISITION COSTS:
During 2011, the Company incurred $44 million (2010–$21 million) of
restructuring expenses related to severances resulting from the
targeted restructuring of its employee base and to improve the
Company’s cost structure.
2011 ANNUAL REPORT ROGERS COMMUNICATIONS INC. 103