Equifax 2002 Annual Report Download - page 54

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
of $4.5 million. They resulted in $20.5 million of goodwill and
$27.2 million of purchased data files. Their results of operations
have been included in the consolidated statements of income from
their respective dates of acquisition and were not material.
Goodwill related to acquisitions was allocated to our reporting
segments as follows:
(In millions, except per share amounts) 2002 2001 2000
Equifax North America $145.5 $13.2 $195.5
Equifax Europe 2.6 –15.4
Equifax Latin America 27.6 7.3 7.2
Total $175.7 $20.5 $218.1
During 2000, we acquired or increased our ownership in the
following businesses:
Month Industry Percentage
Business Acquired Segment Ownership
Organizacion Veraz S.A.
(Argentina) December Latin America 79.5%(1)
SEK S.r.l. and AIF Gruppo
Securitas S.r.l. (Italy) November Europe 100.0%
Compliance Data
Center, Inc. October North America 100.0%
Consumer Information
Solutions (CIS) Group
of R.L. Polk & Co. May North America 100.0%
Propago, S.A. (Chile) January Latin America 100.0%
(1) Increased to 79.5% from 66.7% acquired in 1997 and 1994
In 2000, in addition to the businesses above, we acquired the
credit files, customer contracts, and related business, of 12 Affil-
iates located in the United States and 14 Affiliates in Canada. All
of the 2000 acquisitions were accounted for as purchases and had
an aggregate purchase price of $348.4 million. They were purchased
with a combination of cash totaling $334.8 million, the re-issuance
of treasury stock with a fair market value of $10.6 million, and
notes payable of $3.0 million. The estimated fair value of the net
assets acquired and the liabilities assumed at the acquisition
dates are summarized in the following table:
(In millions)
Current Assets $ 43.0
Property and Equipment 11.0
Other Assets 17.3
Purchased Data Files 78.8
Goodwill 218.1
Total Acquired Assets 368.2
Total Liabilities 19.8
Net Assets Acquired $348.4
The results of operations from these acquisitions have been
included in our consolidated statements of income from the dates
of acquisition. The following unaudited pro forma information has
been prepared as if these acquisitions had occurred on January 1,
2000. The information is based on the historical results of the
separate companies, and may not necessarily be indicative of the
results that could have been achieved, or of results that may occur
in the future.
(In millions, except per share amounts) 2000
Revenue $1,277.0
Net income 141.1
Net earnings per common share (diluted) 1.04
4.
DIVESTITURES
In October 2001, we sold our City Directory business, which had
been acquired from R.L. Polk & Co. in May 2000. The resulting pre-
tax loss of $5.8 million ($4.9 million after tax, or $0.035 per share)
was recorded in our consolidated statement of income as a charge
to other income in September 2001.
In October 2000, we sold our risk management collections busi-
nesses located in the U.S., Canada, and the United Kingdom, and
in December 2000, sold our vehicle information business in the
United Kingdom, as well as a direct marketing business in Canada
that was a small component of the CIS group acquired earlier in
the year from R.L. Polk & Co. Proceeds from these sales included
cash of $149.2 million (net of cash sold) and a $41.0 million note
receivable from one of the buyers (repaid to us in 2002), and
resulted in a pre-tax loss of $4.2 million recorded in other income.
Approximately $25.5 million of the proceeds received in the U.S.
and Canadian risk management sales related to exclusive con-
tracts to provide the buyers with credit information products and
services over several years, and was recorded in current and long-
term deferred revenue. In conjunction with the sale of our risk
management collections business in the United Kingdom, we guar-
anteed approximately $60.0 million of the buyer’s third-party
acquisition financing which related to a portfolio of purchased
paper. Since this purchased paper financing was entirely guaran-
teed by us, the amount guaranteed has been recorded in other
assets and other long-term liabilities in the accompanying consoli-
dated balance sheets. These corresponding asset and liability
balances will be reduced as the buyer makes principal payments
on their loan and our guarantee is reduced. The balances totaled
$1.7 million, $31.2 million, and $59.1 million at December 31,
2002, 2001, and 2000, respectively.
50