Virgin Media 2008 Annual Report Download - page 180
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VIRGIN MEDIA INVESTMENT HOLDINGS LIMITED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Note 4—Acquisitions (Continued)
Contractual relationships represented the fair value of certain contracts with distributors of our
products and services. The fair value of these contracts was determined utilizing the income approach.
We amortize the fair value of these assets on a straight-line basis over the remaining life of the
contracts of three years.
Reverse Acquisition of Telewest
On March 3, 2006, Virgin Media merged with Telewest and the merger was accounted for as a
reverse acquisition of Telewest using the purchase method. This merger created the U.K.’s largest
provider of residential broadband and the U.K.’s leading provider of ‘‘triple-play’’ services. In
connection with this transaction, Telewest changed its name to NTL Incorporated, and has since
changed its name to Virgin Media Inc.
On June 19, 2006, in connection with the integration of Virgin Media and Telewest, we engaged in
a post acquisition restructuring of Telewest UK Limited and its subsidiaries in order to integrate their
operations with Virgin Media’s existing U.K. operations and to implement permanent financing. This
restructuring involved a series of steps that included internal contributions, distributions, mergers and
acquisitions as well as borrowings from external sources and contributions of the proceeds of the same
to us, to effect our acquisition of the shares of Telewest UK Limited and its subsidiaries. The
completion of this restructuring resulted in Telewest UK Limited and its subsidiaries becoming our
wholly owned subsidiary.
We have accounted for the acquisition of Telewest UK Limited and its subsidiaries by applying the
principles of FAS 141, Business Combinations in respect to transactions between entities under common
control. As a result, the assets acquired and liabilities assumed have been recognized at their historical
cost and the results of operations and cash flows for Telewest UK Limited are included in our
consolidated financial statements from June 19, 2006, the date the restructuring was completed.
F-86