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Acquisitions (Tables)
 3 Months Ended
Mar. 31, 2018
Business Combinations [Abstract]  
Schedule of assets acquired and liabilities assumed
The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date. We do not expect material changes to the assigned values.
 Accounts receivable, net of allowance for doubtful accounts (1)
$
72

 Inventory
5

 Rental equipment
551

 Property and equipment
45

 Intangibles (customer relationships) (2)
153

 Other assets
5

 Total identifiable assets acquired
831

 Current liabilities
(61
)
 Deferred taxes
(35
)
 Other long-term liabilities
(3
)
 Total liabilities assumed
(99
)
 Net identifiable assets acquired
732

 Goodwill (3)
584

 Net assets acquired
$
1,316

(1) The fair value of accounts receivables acquired was $72, and the gross contractual amount was $74. We estimated that $2 would be uncollectible.
(2) The customer relationships are being amortized over a 10 year life.
(3) All of the goodwill was assigned to our general rentals segment. The level of goodwill that resulted from the acquisition is primarily reflective of Neff's going-concern value, the value of Neff's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that would not be available to other market participants. $12 of goodwill is expected to be deductible for income tax purposes.
The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date. We do not expect material changes to the assigned values.
 Accounts receivable, net of allowance for doubtful accounts (1)
$
49

 Inventory
4

 Rental equipment
571

 Property and equipment
48

 Intangibles (2)
139

 Other assets
7

 Total identifiable assets acquired
818

 Short-term debt and current maturities of long-term debt (3)
(3
)
 Current liabilities
(33
)
 Deferred taxes
(15
)
 Long-term debt (3)
(11
)
 Other long-term liabilities
(5
)
 Total liabilities assumed
(67
)
 Net identifiable assets acquired
751

 Goodwill (4)
209

 Net assets acquired
$
960

(1) The fair value of accounts receivables acquired was $49, and the gross contractual amount was $53. We estimated that $4 would be uncollectible.
(2) The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:
 
Fair value
 Life (years)
 Customer relationships
$
138

10
 Non-compete agreements
1

1
 Total
$
139

 

(3) The acquired debt reflects capital lease obligations.
(4) All of the goodwill was assigned to our general rentals segment. The level of goodwill that resulted from the acquisition is primarily reflective of NES's going-concern value, the value of NES's assembled workforce, new customer relationships expected to arise from the acquisition, and operational synergies that we expect to achieve that would not be available to other market participants. $1 of goodwill is expected to be deductible for income tax purposes.
Schedule of intangible assets acquired
The following table reflects the estimated fair values and useful lives of the acquired intangible assets identified based on our purchase accounting assessments:
 
Fair value
 Life (years)
 Customer relationships
$
138

10
 Non-compete agreements
1

1
 Total
$
139

 
Summary of business acquisition, pro forma information
The table below presents unaudited pro forma consolidated income statement information as if NES and Neff had been included in our consolidated results for the entire period reflected:
 
 
Three Months Ended
 
 
 
March 31, 2017
 
 
 
United Rentals

 
NES
 
Neff
 
Total
 
Historic/pro forma revenues
 
$
1,356

 
$
81

 
$
96

 
$
1,533

 
Historic/combined pretax income (loss)
 
161

 
(12
)
 
7

 
156

 
Pro forma adjustments to pretax income (loss):
 
 
 
 
 
 
 
 
 
Impact of fair value mark-ups/useful life changes on depreciation (1)
 
 
 
(9
)
 
(3
)
 
(12
)
 
Impact of the fair value mark-up of acquired fleet on cost of rental equipment sales (2)
 
 
 
(1
)
 
—

 
(1
)
 
Intangible asset amortization (3)
 
 
 
(6
)
 
(7
)
 
(13
)
 
Interest expense (4)
 
 
 
(9
)
 
(17
)
 
(26
)
 
Elimination of historic interest (5)
 
 
 
12

 
11

 
23

 
Elimination of merger related costs (6)
 
 
 
2

 
—

 
2

 
Restructuring charges (7)
 
 
 
(18
)
 
(14
)
 
(32
)
 
Pro forma pretax income
 
 
 
 
 
 
 
$
97

 
(1) Depreciation of rental equipment and non-rental depreciation were adjusted for the fair value mark-ups, and the changes in useful lives and salvage values, of the equipment acquired in the NES and Neff acquisitions.
(2) Cost of rental equipment sales was adjusted for the fair value mark-ups of rental equipment acquired in the NES and Neff acquisitions.
(3) The intangible assets acquired in the NES and Neff acquisitions were amortized.
(4) As discussed above, we issued debt to partially fund the NES and Neff acquisitions. Interest expense was adjusted to reflect these changes in our debt portfolio.
(5) Historic interest on debt that is not part of the combined entity was eliminated.
(6) Merger related costs primarily comprised of financial and legal advisory fees associated with the NES and Neff acquisitions were eliminated as they were assumed to have been recognized prior to the pro forma acquisition date.
(7) We expect to recognize restructuring charges primarily comprised of severance costs and branch closure charges associated with the acquisitions over a period of approximately one year following the acquisition dates, which, for the pro forma presentation, was January 1, 2017. The adjustments above reflect the timing of the actual restructuring charges following the acquisitions (the pro forma restructuring charges above for the three months ended March 31, 2017 reflect the actual restructuring charges recognized during the three months following the acquisitions).