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TWENTY-FIRST CENTURY FOX, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
89
NOTE 3. ACQUISITIONS, DISPOSALS AND OTHER TRANSACTIONS
During the fiscal year ended June 30, 2014, the Company completed a number of acquisitions as more fully
described below. All of the Company’s acquisitions were accounted for under ASC 805, “Business Combinations”
(“ASC 805”), which requires, among other things, that an acquirer (i) remeasure any previously held equity interest
in an acquiree at its acquisition date fair value and recognize any resulting gains or losses in earnings and (ii) record
any noncontrolling interests in an acquiree at their acquisition date fair values. Accordingly, several of the
transactions described below resulted in the recognition of remeasurement gains since the Company acquired control
of an acquiree in stages. Further, other transactions described below involved the Company acquiring control with
an ownership stake of less than 100%. In those instances, the allocation of the excess purchase price reflects 100%
of the fair value of the acquiree with the noncontrolling interests recorded at fair value.
The below acquisitions all support the Company’s strategic priority of increasing its brand presence and reach
in key international and domestic markets, acquiring greater control of investments that complement its portfolio of
businesses and creating new pay-TV sports franchises. For those acquisitions where the accounting for the business
combination is based on provisional amounts and the allocation of the excess purchase price is not final, the amounts
allocated to intangibles and goodwill, the estimates of useful lives and the related amortization expense are subject
to change pending the completion of final valuations of certain assets and liabilities. A change in the purchase price
allocations and any estimates of useful lives could result in a change in the value allocated to the intangible assets
that could impact future amortization expense.
Fiscal 2015
Dispositions
Sky Italia and Sky Deutschland
In July 2014, the Company entered into agreements with British Sky Broadcasting Group plc (“BSkyB”) to
sell its 100% and 57% (on a fully diluted basis) ownership stakes in Sky Italia and Sky Deutschland AG (“Sky
Deutschland”), respectively, for approximately $9.3 billion (based on foreign currency exchange rates as of the date
of the agreements) comprised of approximately $8.6 billion in cash and the transfer to the Company of BSkyB’s
21% interest in NGC Network International LLC and NGC Network Latin America LLC (collectively “NGC
International”), increasing the Company’s ownership stake to 73% in NGC International. In connection with this
transaction, the Company participated in BSkyB’s equity offering in July 2014 by purchasing additional shares in
BSkyB for approximately $900 million and maintained the Company’s 39% ownership interest. The agreements are
subject to regulatory approvals, the approval of BSkyB stockholders and customary closing conditions.
Fiscal 2014
Acquisitions
Latin America Pay Television
In May 2012, the Company acquired an interest of approximately 23% in Latin America Pay Television
(“LAPTV”), an entity that distributes premium and basic television channels in Latin America, for $64 million in
cash. As a result of this transaction, the Company increased its interest in LAPTV to approximately 78% from the
55% it owned at June 30, 2011. In September 2013, the Company acquired the remaining 22% interest in LAPTV
for approximately $75 million in cash. As a result of this transaction, the Company now owns 100% of LAPTV.
These transactions were accounted for as the purchase of subsidiary shares from noncontrolling interests.
Yankees Entertainment and Sports Networks
In December 2012, the Company acquired a 49% equity interest in the Yankees Entertainment and Sports
Network (“YES Network”), a Regional Sports Network (“RSN”) primarily broadcasting pre-season and regular
season games for the New York Yankees and the Brooklyn Nets, for $584 million. Simultaneous with the closing of
this transaction, the Company also paid approximately $250 million of upfront programming costs on behalf of the
YES Network. The Company accounted for its investment in the YES Network under the equity method of