eBay 2011 Annual Report Download - page 105

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eBay Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Note 3 - Business Combinations
Our acquisition activity in 2011 , 2010 and 2009 , was as follows:
2011 Acquisition Activity
During 2011 , we completed thirteen acquisitions, including the acquisitions of GSI, brands4friends, GittiGidiyor and Zong. Allocation of
the purchase consideration for the business combinations completed in 2011 is summarized as follows (in thousands):
The purchase consideration for each acquisition was allocated to the tangible assets and intangible assets acquired and liabilities assumed
based on their estimated fair values on the acquisition date, with the remaining unallocated purchase consideration recorded as goodwill. The fair
value assigned to identifiable intangible assets acquired has been determined primarily by using valuation methods that discount expected future
cash flows to present value using estimates and assumptions determined by management. Purchased identifiable intangible assets are amortized on
a straight-
line basis over the respective useful lives. We generally do not expect goodwill to be deductible for income tax purposes. The estimation
of fair values for tangible assets and intangible assets acquired and liabilities assumed was subject to estimates, assumptions and other
uncertainties, and it is possible that the allocation of the purchase consideration reflected in the foregoing table may change.
GSI
Acquisition
We completed the acquisition of GSI on June 17, 2011 . GSI is a leading provider of ecommerce and interactive marketing services. We
acquired GSI to utilize its comprehensive integrated suite of online commerce and interactive marketing services to strengthen our ability to
connect buyers and sellers worldwide. We paid $29.25 per share, and assumed restricted stock-based awards with a fair value of approximately
$24.8 million , resulting in total consideration of
F-14
Year Ended December 31,
2011
2010
2009
(In thousands, except per share amounts)
Numerator:
Net income
$
3,229,387
$
1,800,961
$
2,389,097
Denominator:
Weighted average common shares - basic
1,292,775
1,305,593
1,289,848
Dilutive effect of equity incentive plans
20,175
21,824
15,133
Weighted average common shares - diluted
1,312,950
1,327,417
1,304,981
Net income per share:
Basic
$
2.50
$
1.38
$
1.85
Diluted
$
2.46
$
1.36
$
1.83
Common stock equivalents excluded from income per diluted share because their effect
would have been anti-dilutive
16,762
31,509
53,026
Purchase
Consideration
Net Tangible
Assets Acquired/
(Liabilities
Assumed) Purchased
Intangible Assets Goodwill
GSI
$
2,377,257
$
74,498
$
819,100
$
1,483,659
brands4friends
193,236
(33,146
)
76,143
150,239
GittiGidiyor
235,278
(8,787
)
52,700
191,365
Zong
231,663
(35,650
)
76,500
190,813
Other
401,713
(34,332
)
163,677
272,368
Total
$
3,439,147
$
(37,417
)
$
1,188,120
$
2,288,444