VMware 2012 Annual Report Download - page 83

Table of Contents VMware, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
Fiscal Year 2011
In 2011 , VMware completed six business combinations, which were not material to VMware's consolidated financial statements, either
individually or in the aggregate. The aggregate consideration for these acquisitions was $304.2 million , net of cash acquired, and includes cash
of $303.6 million and the fair value of equity awards assumed attributed to pre-combination services of $0.6 million . 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):
Fiscal Year 2010
Business Acquisitions
In 2010 , VMware completed six business combinations, which were not material to VMware’s consolidated financial statements, either
individually or in the aggregate. The aggregate consideration for these acquisitions was $293.0 million , net of cash acquired. The following
table summarizes the allocation of the consideration paid to the fair value of the tangible and intangible assets acquired and liabilities assumed
(table in thousands):
Transfer of Net Assets Under Common Control
In 2010, VMware acquired certain software product technology and expertise from EMC’s Ionix information technology (“IT”)
management business for cash consideration of $175.0 million . The acquired software product technology and expertise complemented
VMware’s existing development efforts and expanded its vCenter product family. EMC retained the Ionix brand and continues to offer
customers the products acquired by VMware, pursuant to the ongoing reseller agreement between EMC and VMware. Additionally, contingent
amounts totaling up to $25.0 million were payable to EMC by the end of the second anniversary of the transfer. These amounts were contingent
on EMC achieving certain revenue milestones. During the years ended December 31, 2011 and 2010 , contingent consideration of $14.4 million
and $10.6 million , respectively, was paid to EMC. These amounts were recorded as equity transactions and were offsets to the initial capital
contribution from EMC.
The net assets and expertise acquired from EMC constituted a business and were accounted for as a business combination between entities
under common control pursuant to generally accepted accounting principles. Accordingly, VMware included the EMC carrying values of the
transferred assets and liabilities as of the date of transfer in its consolidated financial statements, as well as recorded the excess of the carrying
values over the cash consideration as an equity transaction. VMware did not revise its historical consolidated financial statements as the
historical impact of the acquired net assets was not material to the previously reported financial positions, results of operations, or cash flows.
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Intangible assets
$
104,500
Goodwill
188,395
Deferred tax assets, net
23,353
Total tangible and intangible assets acquired
316,248
Other acquired liabilities, net of acquired assets
(12,004
)
Total liabilities assumed
(12,004
)
Fair value of tangible and intangible assets acquired and liabilities assumed
$
304,244
Intangible assets
$
114,100
Goodwill
178,160
Deferred tax assets, net
18,220
Total tangible and intangible assets acquired
310,480
Other acquired liabilities, net of acquired assets
(17,510
)
Total liabilities assumed
(17,510
)
Fair value of tangible and intangible assets acquired and liabilities assumed
$
292,970