Avis 2012 Annual Report Download - page 73

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F-17
Other intangibles consisted primarily of $188 million related to license agreements and $66 million related to customer
relationships. These license agreements are amortized over a weighted-average life of approximately 20 years. Customer
relationships are amortized over a weighted-average life of approximately 12 years. Differences between the preliminary
allocation of the purchase price used for the balance sheet as of December 31, 2011 and the final allocation of the
purchase price were not material.
Avis Europe contributed net revenues of $359 million and a net loss of $223 million including $213 million transaction-
related costs, net of tax to the Company’s results from October 3, 2011 through December 31, 2011. The net loss was
primarily due to the non-cash charge, recorded at the time of the acquisition, related to the unfavorable license rights
reacquired by the Company. The following unaudited pro forma summary presents the Company’s consolidated
information as if Avis Europe had been acquired on January 1, 2010. These amounts were calculated after conversion of
Avis Europe’s results into U.S. dollars, applying adjustments to align the financial information with GAAP and the
Company’s accounting policies. In addition, adjustments were made to reflect the impact to amortization expense and
related income tax expense for fair value adjustments and revised useful lives assigned to intangible assets as if Avis
Europe had been acquired on January 1, 2010. In the calculation of pro forma net income, $213 million of transaction-
related costs, net of tax incurred in the year ended December 31, 2011 were treated as incurred in the year ended
December 31, 2010.
(unaudited)
Pro Forma Summary for the
Year Ended December 31,
2011
2010
Net revenues
$
7,259
$
6,768
Net income
234
(133)
Earnings per share – Diluted
1.82
(1.29)
Zipcar
In December 2012, the Company entered into a definitive agreement to acquire Zipcar, Inc. (“Zipcar”), the world’s
leading car sharing network, for approximately $500 million. The transaction is subject to approval by Zipcar
shareholders and other customary closing conditions.
7. Intangible Assets
Intangible assets consisted of:
As of December 31, 2012
As of December 31, 2011
Gross
Carrying
Amount
Accumulated
Amortization
Net
Carrying
Amount
Gross
Carrying
Amount
Accumulated
Amortization
Net
Carrying
Amount
Amortized Intangible Assets
License agreements (a) (f)
$
257
$
39
$
218
$
252
$
29
$
223
Customer relationships (b) (e)
86
19
67
80
12
68
Other (c)
2
1
1
2
1
1
$
345
$
59
$
286
$
334
$
42
$
292
Unamortized Intangible Assets
Goodwill (d)
$
375
$
353
Trademarks (d)
$
445
$
421
__________
(a) Primarily amortized over a period ranging from 20 to 40 years.
(b) Primarily amortized over a period ranging from 8 to 20 years.
(c) Primarily amortized over 27 years.
(d) The increase primarily relates to the Apex acquisition and adjustments to the allocation of purchase price.
(e) The increase primarily relates to adjustments to the allocation of purchase price.
(f) The increase relates to fluctuations in currency exchange rates and adjustments to the allocation of purchase price.