Memorex 2009 Annual Report Download - page 58

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The following illustrates our allocation of the purchase price to the assets acquired and liabilities assumed as of
December 31, 2007:
Amount
(In millions)
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 25.8
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147.9
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91.5
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.8
Property, plant and equipment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.3
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55.9
Intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132.1
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.8
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (121.6)
Accrued payroll . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2.2)
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (39.1)
Deferred tax liability arising on acquisition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3.8)
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9.5)
$ 314.9
Goodwill impairment of $46.3 million was recorded during the year ended December 31, 2007. The remaining
goodwill was written off during the year ended December 31, 2008.
Our allocation of the purchase price to the assets acquired and liabilities assumed resulted in the recognition of the
following intangible assets:
Amount
Weighted
Average
Life
(In millions)
Tradename................................................... $115.0 30 years
Customer relationships. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.0 6 years
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1 18 months
Intangible assets acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $132.1
In determining the useful life of the TDK Life on Record trade name, we considered the following: (1) the overall
strength of the TDK Life on Record trade name in the market in terms of market awareness and market share, (2) the
length of time that the TDK Life on Record trade name has been in existence, (3) the period of time over which the TDK
Life on Record trade name is expected to remain in use and (4) that the TDK Life on Record trade name has remained
strong through technological innovation in the data storage industry. Based on this analysis, we determined that the useful
life for the TDK Life on Record trade name was estimated to be 30 years.
TDK Recording Media operating results are included in our Consolidated Statements of Operations from the date of
acquisition.
Memcorp
On July 9, 2007, we completed the acquisition of certain assets of Memcorp, Inc., a Florida corporation, and
Memcorp Asia Limited, a corporation organized under the laws of Hong Kong (together Memcorp, subsidiaries of Hopper
Radio of Florida, Inc., a Florida corporation), pursuant to an asset purchase agreement dated as of May 7, 2007 (the
Memcorp Purchase Agreement). As provided in the Memcorp Purchase Agreement, we acquired the assets of Memcorp
used in or relating to the sourcing and sale of consumer electronic products, principally sold under the Memorex brand
51
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)