Western Digital 2008 Annual Report Download - page 78

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Sept. 5,
2007
Tangible assets acquired and liabilities assumed:
Cash ............................................................... $ 72
Short-term investments .................................................. 58
Accounts receivable ..................................................... 114
Inventories ........................................................... 204
Other current assets..................................................... 6
Property and equipment ................................................. 657
Deferred taxes and other non-current assets .................................... 118
Accounts payable ...................................................... (130)
Accrued expenses....................................................... (81)
Debt assumed ......................................................... (248)
Other liabilities ....................................................... (15)
Intangible assets ......................................................... 89
In-process research and development ........................................... 49
Goodwill .............................................................. 109
Total ................................................................. $1,002
Property and Equipment
The property and equipment acquired was valued at current replacement cost for similar assets. Land and buildings
were estimated at fair value on September 5, 2007, the date of the Acquisition. The following table summarizes the
estimated fair value of the property and equipment acquired from Komag and their estimated useful lives:
Estimated Fair
Value
Estimated
Weighted-Average
Useful Life
(in millions) (in years)
Land leases ........................................... $ 17 36.8
Buildings and improvements .............................. 224 17.8
Equipment ........................................... 416 5.0
Total property and equipment ........................... $657 10.3
Inventories
Total inventories acquired included $11 million and $39 million of finished goods and work-in-process, respec-
tively. Finished goods and work-in-process were valued at estimated selling prices less costs of disposal, estimated reseller
profit and costs to complete. Acquired raw materials of $154 million, consisting primarily of precious metals, were
valued at estimated replacement cost.
Identifiable Intangible Assets Acquired
In accordance with SFAS 141, the Company identified intangible assets apart from goodwill if one of the following
criteria was met: 1) the asset arises from contractual or other legal rights; or 2) the asset is capable of being separated or
divided from the acquired enterprise and sold, transferred, licensed, rented, or exchanged, either individually or in
72
WESTERN DIGITAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)