Avis 2015 Annual Report Download - page 88

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F-19
segment for Edmonton, Southern California and Las Vegas and to the Company’s International reportable
segment for Portugal. In connection with these acquisitions, approximately $58 million was recorded in
identifiable intangible assets (consisting of $10 million related to customer relationships and $48
million related to the license agreements) and $192 million was recorded in goodwill. The customer
relationships will be amortized over a weighted average useful life of approximately 12 years and the
license agreements will be amortized over a weighted average useful life of approximately three years. In
addition, the Company recorded a non-cash gain of approximately $20 million within transaction-related
costs, net in connection with license rights reacquired by the Company. The goodwill is deductible for tax
purposes. Differences between the preliminary allocation of purchase price and the final allocation were not
material for Edmonton, Southern California and Las Vegas and Portugal.
2013
Payless Car Rental
In July 2013, the Company completed the acquisition of Payless for $46 million, net of acquired cash. The
acquisition provided the Company with a position in the deep-value segment of the car rental industry. The
excess of the purchase price over preliminary fair value of net assets acquired was allocated to goodwill,
which was assigned to the Company’s Americas reportable segment. The goodwill is not deductible for tax
purposes. In connection with this acquisition, $23 million was recorded in identifiable intangible assets
(consisting of $16 million related to trademarks and $7 million related to license agreements) and $27
million was recorded in goodwill. The trademark assets are indefinite-lived and the license agreements will
be amortized over an estimated life of 15 years.
Zipcar
In March 2013, the Company completed the acquisition of the entire issued share capital of Zipcar, a
leading car sharing company, for $473 million, net of acquired cash. The acquisition increased the
Company’s growth potential and its ability to better serve a greater variety of customer transportation
needs. The excess of the purchase price over fair value of net assets acquired was allocated to goodwill,
which was assigned to the Company’s Americas reportable segment and is not deductible for tax purposes.
In connection with this acquisition, $188 million was recorded in identifiable intangible assets (consisting of
$112 million related to trademarks and $76 million related to customer relationships) and $269 million was
recorded in goodwill. The trademark assets are indefinite-lived and the customer relationship intangibles will
be amortized over an estimated life of eight years.
6. Intangible Assets
Intangible assets consisted of:
As of December 31, 2015 As of December 31, 2014
Gross
Carrying
Amount Accumulated
Amortization
Net
Carrying
Amount
Gross
Carrying
Amount Accumulated
Amortization
Net
Carrying
Amount
Amortized Intangible Assets
License agreements (a) $ 263 $ 81 $ 182 $ 259 $ 59 $ 200
Customer relationships (b) 222 68 154 167 50 117
Other (b) 41 8 33 8 3 5
$ 526 $ 157 $ 369 $ 434 $ 112 $ 322
Unamortized Intangible Assets
Goodwill $ 973 $ 842
Trademarks $ 548 $ 564
_________
(a) Primarily amortized over a period ranging from 1 to 40 years with a weighted average life of 19 years.
(b) Primarily amortized over a period ranging from 2 to 27 years with a weighted average life of 11 years.