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WDC » Topics » Purchase Price Allocation

These excerpts taken from the WDC 10-K filed Aug 20, 2008.
Purchase Price Allocation
 
The aggregate purchase price for Komag was $1.0 billion, consisting of cash paid for outstanding shares, transaction fees, severance and other employee-related equity payments. The application of purchase accounting under SFAS No. 141, “Business Combinations” (“SFAS 141”), requires that the total purchase price be allocated to the fair value of assets acquired and liabilities assumed based on their fair values at the acquisition date, with amounts exceeding the fair values being recorded as goodwill. The allocation process requires an analysis and valuation of acquired assets, including fixed assets, deferred tax assets, technologies, customer contracts and relationships, trade names and liabilities assumed, including contractual commitments and legal contingencies. The values assigned to certain acquired assets and liabilities were finalized as of June 27, 2008.
 
The Company has identified and recorded the assets, including specifically identifiable intangible assets, and liabilities assumed from Komag at their estimated fair values as of the date of the Acquisition, and has allocated the residual value to goodwill.
 


71

Table of Contents

 
WESTERN DIGITAL CORPORATION
 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
 
         
    Sept. 5,
 		 
    2007  
 
Tangible assets acquired and liabilities assumed:
       
Cash
  $ 72  
Short-term investments
    58  
Accounts receivable
    114  
Inventories
    204  
Other current assets
    6  
Property and equipment
    657  
Deferred taxes and other non-current assets
    118  
Accounts payable
    (130 )
Accrued expenses
    (81 )
Debt assumed
    (248 )
Other liabilities
    (15 )
Intangible assets
    89  
In-process research and development
    49  
Goodwill
    109  
         
Total
  $ 1,002  
         
 
Purchase
Price Allocation


 



The aggregate purchase price for Komag was $1.0 billion,
consisting of cash paid for outstanding shares, transaction
fees, severance and other employee-related equity payments. The
application of purchase accounting under SFAS No. 141,
“Business Combinations” (“SFAS 141”),
requires that the total purchase price be allocated to the fair
value of assets acquired and liabilities assumed based on their
fair values at the acquisition date, with amounts exceeding the
fair values being recorded as goodwill. The allocation process
requires an analysis and valuation of acquired assets, including
fixed assets, deferred tax assets, technologies, customer
contracts and relationships, trade names and liabilities
assumed, including contractual commitments and legal
contingencies. The values assigned to certain acquired assets
and liabilities were finalized as of June 27, 2008.


 



The Company has identified and recorded the assets, including
specifically identifiable intangible assets, and liabilities
assumed from Komag at their estimated fair values as of the date
of the Acquisition, and has allocated the residual value to
goodwill.


 





71




Table of Contents





 




WESTERN
DIGITAL CORPORATION




 




NOTES TO
CONSOLIDATED FINANCIAL
STATEMENTS — (Continued)

 

























































































































































         

 

 

Sept. 5,



 

 

 

2007

 
 


Tangible assets acquired and liabilities assumed:


 

 

 

 


Cash


 

$

72

 


Short-term investments


 

 

58

 


Accounts receivable


 

 

114

 


Inventories


 

 

204

 


Other current assets


 

 

6

 


Property and equipment


 

 

657

 


Deferred taxes and other non-current assets


 

 

118

 


Accounts payable


 

 

(130

)


Accrued expenses


 

 

(81

)


Debt assumed


 

 

(248

)


Other liabilities


 

 

(15

)


Intangible assets


 

 

89

 


In-process research and development


 

 

49

 


Goodwill


 

 

109

 

 

 

 

 

 


Total


 

$

1,002

 

 

 

 

 

 






 




EXCERPTS ON THIS PAGE:

10-K (2 sections)
Aug 20, 2008

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