Virgin Media 2006 Annual Report Download - page 101

VIRGIN MEDIA INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
5. Acquisitions (Continued)
The total purchase price of £3.5 billion has been allocated as follows (in millions):
Acquisition
Date
Cash and cash equivalents, including restricted cash £ 303.2
Accounts receivable 155.6
Prepaid expenses and other current assets 36.5
Fixed assets 2,932.9
Inventory 34.8
Investments in and loans to affiliates 377.9
Amortizable intangible assets:
Customer lists 761.6
Trade names 10.7
Licenses 37.0
Intangible assets with indefinite lives:
Goodwill 1,381.4
Trade names 16.5
Accounts payable (144.7)
Long term debt, including current portion (1,873.7)
Other current liabilities (465.2)
Other long term liabilities (38.5)
Deferred income taxes (77.0)
Total purchase price £ 3,449.0
Amortizable intangible assets
Of the total purchase price, £809.3 million has been allocated to amortizable intangible assets including customer lists, trade
names and licenses. Customer lists represent existing contracts that relate primarily to underlying customer relationships pertaining to
the services provided by Telewest. The fair value of these assets was determined utilizing the income approach. We expect to amortize
the fair value of these assets on a straight−line basis over weighted average estimated useful lives of between five and eight years.
Trade names represent the Telewest and Blueyonder brand names. The fair value of these assets was determined utilizing a relief
from royalty method. We expect to amortize the fair value of these assets on a straight−line basis over weighted average estimated
useful lives of between 1 and 9 years.
Licenses represent contracts to broadcast television content over a digital broadcasting system in the United Kingdom. The fair
value of these contracts was determined utilizing the income approach. We expect to amortize the fair value of these assets on a
straight−line basis over a weighted average estimated useful life of four years.
Indefinite life intangible assets
Trade names with indefinite lives represent the Living, Bravo, Trouble and Challenge television channel names. We have
determined that these assets have indefinite lives as the trade names do not
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Source: VIRGIN MEDIA INVESTM, 10−K, March 01, 2007