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Table of Contents VMware, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
Amounts in the table above were adjusted in the fourth quarter of 2012 for a reassessment of unrecognized tax benefits related to the Nicira
acquisition. Income taxes payable in the table above primarily relate to these unrecognized tax benefits which were classified as a non-current
liability within other liabilities on the consolidated balance sheet at December 31, 2012.
The following table summarizes the fair value of the intangible assets acquired by VMware in conjunction with the Nicira acquisition
(amounts in table in thousands):
As of December 31, 2012 , the $48.5 million
of IPR&D shown in the table above was completed and included in purchased technology with
a weighted-average life of 8.0 years .
Supplemental information on an unaudited pro forma basis, as if Nicira had been acquired on January 1, 2011, is presented as follows (table
in thousands, except per share amounts):
Pro forma adjustments primarily include intangible amortization, stock-based compensation and related tax effects.
Other 2012 Business Combinations
In 2012 , VMware completed five business combinations in addition to Nicira. The aggregate consideration for these five acquisitions was
$261.2 million , net of cash acquired. The following table summarizes the allocation of the consideration to the fair value of the tangible and
intangible assets acquired and liabilities assumed (table in thousands):
VMware anticipates that $14.7 million of the goodwill acquired will be deductible for income tax purposes.
77
Weighted-Average
Useful Lives
(in years)
Fair Value
Amount
Purchased technology
7.0
$
266,000
Trademarks and tradenames
10.0
20,100
In-process research and development (“IPR&D”)
48,500
Total intangible assets acquired, net, excluding goodwill
$
334,600
For the Year
Ended December 31,
2012
2011
Pro forma adjusted total revenue
$
4,607,109
$
3,770,493
Pro forma adjusted net income
686,833
610,875
Pro forma adjusted net income per weighted-average share, diluted for Class A
and Class B
$
1.58
$
1.41
Intangible assets
$
88,100
Goodwill
186,533
Total intangible assets acquired
274,633
Deferred tax liabilities, net
(8,366
)
Other acquired liabilities, net of acquired assets
(5,053
)
Total liabilities assumed
(13,419
)
Fair value of tangible and intangible assets acquired and liabilities assumed
$
261,214