NVIDIA 2007 Annual Report Download - page 85

NVIDIA CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
Note 4 − Business Combinations
On February 20, 2006, we completed our acquisition of ULi Electronics, Inc., or ULi, a core logic developer for the personal
computer, or PC, industry. The acquisition represents our ongoing investment in our platform solution strategy and has strengthened
our sales, marketing, and customer engineering presence in Taiwan and China. The aggregate purchase price consisted of cash
consideration of approximately $53.1 million.
On March 29, 2006, we completed our acquisition of Hybrid Graphics Ltd., or Hybrid Graphics, a developer of embedded 2D and
3D graphics software for handheld devices. The aggregate purchase price consisted of cash consideration of approximately $36.7
million.
On January 5, 2007, we completed our acquisition of PortalPlayer, a leading supplier of semiconductors, firmware, and software
for personal media players, or PMPs, and secondary display−enabled computers. We believe that the acquisition will accelerate our
ongoing investment in our handheld product strategy. Pursuant to the terms of the acquisition, we paid cash consideration of
approximately $344.9 million in exchange for common stock in PortalPlayer and recognized an additional purchase price of $2.9
million, the value of approximately 658,000 options of NVIDIA common stock issued upon conversion of outstanding PortalPlayer
stock options.
We allocated the purchase price of each of these acquisitions to tangible assets, liabilities and identifiable intangible assets
acquired, as well as in−process research and development, or IPR&D, if identified, based on their estimated fair values. The excess of
purchase price over the aggregate fair values was recorded as goodwill. The fair value assigned to identifiable intangible assets
acquired was based on estimates and assumptions determined by management. Purchased intangibles are amortized on a straight−line
basis over their respective useful lives. The allocation of the purchase price has been prepared on a preliminary basis and reasonable
changes are expected as additional information becomes available.
The following is a summary of estimated fair values of the assets we acquired and liabilities we assumed as of January 28, 2007
for acquisitions we completed in fiscal 2007:
ULi Hybrid Graphics PortalPlayer
(In thousands)
Fair Market Values
Cash and cash equivalents $ 21,551 $ 1,180 $ 10,174
Marketable Securities − − 176,492
Accounts receivable 8,148 808 16,480
Inventories 4,896 − 1,883
Other assets 935 73 12,945
Property and equipment 1,010 134 9,755
In−process research and development − 602 13,400
Goodwill 31,051 27,906 114,816
Intangible assets:
Existing technology 2,490 5,179 8,900
Customer relationships 653 2,650 2,700
Trademark − 482 −
Non−compete agreements − 72 −
Total assets acquired 70,734 39,086 367,545
Current liabilities (16,878) (1,373) (12,139)
Acquisition related costs (781) (740) (7,516 )
Long−term liabilities − (301) (46 )
Total liabilities assumed (17,659) (2,414) (19,701)
Net assets acquired $ 53,075 $ 36,672 $ 347,844
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Source: NVIDIA CORP, 10−K, March 16, 2007