Coach 2014 Annual Report Download - page 74

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TABLE OF CONTENTS



(5) These time deposits have original maturities greater than 3 months and are recorded at fair value.
(6) Primarily relates to the equity method investment related to an equity interest in an entity formed during fiscal 2013 for the purpose of developing a new
office tower in Manhattan (the “Hudson Yards joint venture”), with the Company owning less than 43% of the joint venture, and the Reed Krakoff cost
method investment. As of June 28, 2014, the Company has recorded $181,163 and $3,261 in the Hudson Yards joint venture and the Reed Krakoff cost
method investment, respectively. The Hudson Yards joint venture is determined to be a VIE primarily due to the fact that it has insufficient equity to
finance its activities without additional subordinated financial support from its two joint venture partners. Coach is not considered the primary
beneficiary of the entity primarily because the Company does not have the power to direct the activities that most significantly impact the entity’s
economic performance. The Company’s maximum loss exposure is limited to the committed capital. Refer to Note 12, "Commitments and
Contingencies" for further information.
The amortized cost, gross unrealized gains, gross unrealized losses and fair value of available-for-sale securities are presented below:






Government securities - U.S.  
 
 
 
Corporate debt issues - U.S. 


Corporate debt issues - non-U.S. 



Asset backed securities 
  
 
 
 
June 29, 2013
Amortized Cost
Gross Unrealized Gains
Gross Unrealized Losses
Estimated Fair Value
Corporate debt issues - U.S. $ 66,387
$ —
$ (851)
$ 65,536
Corporate debt issues - non-U.S. 34,393
2
(427)
33,968
Auction rate security 6,000
—
—
6,000
Total $ 106,780
$ 2
$ (1,278)
$ 105,504

Fiscal 2014 Acquisition
On July 1, 2013, Coach became the 100% owner of its European joint venture by purchasing Hackett Limited’s 50% interest in the joint venture,
enabling Coach to assume direct control and consolidate its European retail business. The joint venture included 18 retail locations in Spain, Portugal, Great
Britain, France, Ireland and Germany. The results of the acquired business have been included in the consolidated financial statements since the date of
acquisition within the International segment. The purchase price consisted of cash payments of approximately $15,105 and the forgiveness of a loan from
Coach to Hackett Limited of approximately $18,019. The Company made cash payments of $7,893 in fiscal 2013 and $7,212 in fiscal 2014, which were
partially offset by cash acquired as part of the acquisition of $3,453. The allocation of the purchase price acquisition has been completed resulting in
goodwill of $14,812, which is not tax deductible.
Fiscal 2013 Acquisitions
On July 1, 2012, Coach acquired 100% of its domestic retail business in Malaysia (consisting of 10 retail stores) from the former distributor, Valiram
Group, and on August 5, 2012, acquired 100% of its domestic retail business in South Korea (consisting of 47 retail and department store locations) from the
former distributor, Shinsegae International. The results of the acquired businesses have been included in the consolidated financial statements since the dates
of acquisition within the International segment. The aggregate cash paid in connection with the acquisitions of the Malaysia and South Korea businesses was
$8,593 and
72