NONCONTROLLING INTERESTS

12 Months Ended

Dec. 31, 2012

On May 18, 2010, the Company, through its wholly-owned subsidiary, PIL, paid $108.5 million, net of cash acquired, to purchase a controlling interest of the outstanding equity of TravelJigsaw Holdings Limited (now known as rentalcars.com), a Manchester, U.K.-based international rental car reservation service. Transaction costs of $1.9 million were expensed during the three months ended June 30, 2010.

Certain key members of rentalcars.com’s management team retained a noncontrolling ownership interest in rentalcars.com. In addition, certain key members of the management team of Booking.com purchased a 3% ownership interest in rentalcars.com from PIL in June 2010 (together with rentalcars.com management’s investment, the "Redeemable Shares"). The holders of the Redeemable Shares will have the right to put their shares to PIL and PIL will have the right to call the shares in each case at a purchase price reflecting the fair value of the Redeemable Shares at the time of exercise. Subject to certain exceptions, one-third of the Redeemable Shares will be subject to the put and call options in each of 2011, 2012 and 2013, respectively, during specified option exercise periods. In April 2012 and 2011, in connection with the exercise of call and put options, PIL purchased a portion of the shares underlying redeemable noncontrolling interests for an aggregate purchase price of approximately $61.1 million and $13.0 million, respectively. As a result of the April 2011 purchase, the redeemable noncontrolling interests in rentalcars.com were reduced from 24.4% to 19.0%. As a result of the April 2012 purchase, the redeemable noncontrolling interests in TravelJigsaw Holdings Limited were further reduced to 12.7%.

Redeemable noncontrolling interests are measured at fair value, both at the date of acquisition and subsequently at each reporting period. The redeemable noncontrolling interests are reported on the Consolidated Balance Sheets in mezzanine equity in "Redeemable noncontrolling interests."

A reconciliation of redeemable noncontrolling interests for the years ended December 31, 2012, 2011 and 2010 is as follows (in thousands):



	2012			2011			2010
Balance, beginning of period	$	127,045		$	45,751		$	—
Fair value at acquisition	—			—			29,520
Net income attributable to noncontrolling interests	4,471			2,760			601
Fair value adjustments⁽¹⁾	84,693			91,743			7,876
Sale of subsidiary shares⁽²⁾	—			—			4,311
Purchase of subsidiary shares at fair value⁽¹⁾	(61,079		)	(12,986		)	—
Currency translation adjustments	5,157			(223		)	3,443
Balance, end of period	$	160,287		$	127,045		$	45,751

_____________________________

(1) The fair value of the redeemable noncontrolling interests was determined by industry peer comparable analysis and a discounted cash flow valuation model.


(2)	The Company retained a controlling interest after the sale of the subsidiary shares in June 2010.

- Definition

The entire disclosure for noncontrolling interest in consolidated subsidiaries, which could include the name of the subsidiary, the ownership percentage held by the parent, the ownership percentage held by the noncontrolling owners, the amount of the noncontrolling interest, the location of this amount on the balance sheet (when not reported separately), an explanation of the increase or decrease in the amount of the noncontrolling interest, the noncontrolling interest share of the net Income or Loss of the subsidiary, the location of this amount on the income statement (when not reported separately), the nature of the noncontrolling interest such as background information and terms, the amount of the noncontrolling interest represented by preferred stock, a description of the preferred stock, and the dividend requirements of the preferred stock.

+ References+ Details