Intangible Assets And Goodwill |
Intangible Assets and Goodwill Intangible assets consisted of the following at June 30, 2012 and December 31, 2011: | | | | | | | | | | | | | | | | | | | | | | | | | | | | June 30, 2012 | | December 31, 2011 | (in millions) | | Assigned Value | | Accumulated Amortization | | Net Book Value | | Assigned Value | | Accumulated Amortization | | Net Book Value | Amortizable Intangible Assets: | | | | | | | | | | | | | Clearing firm, market data and other customer relationships | | $ | 2,828.7 |
| | $ | (419.5 | ) | | $ | 2,409.2 |
| | $ | 3,071.9 |
| | $ | (400.4 | ) | | $ | 2,671.5 |
| Lease-related intangibles | | 47.2 |
| | (28.7 | ) | | 18.5 |
| | 83.2 |
| | (45.4 | ) | | 37.8 |
| Technology-related intellectual property | | 22.4 |
| | (11.6 | ) | | 10.8 |
| | 56.2 |
| | (28.4 | ) | | 27.8 |
| Other(1) | | 9.8 |
| | (9.6 | ) | | 0.2 |
| | 11.6 |
| | (10.6 | ) | | 1.0 |
| | | 2,908.1 |
| | (469.4 | ) | | 2,438.7 |
| | 3,222.9 |
| | (484.8 | ) | | 2,738.1 |
| Foreign currency translation adjustments | | — |
| | — |
| | — |
| | (8.8 | ) | | 5.9 |
| | (2.9 | ) | Total amortizable intangible assets | | $ | 2,908.1 |
| | $ | (469.4 | ) | | 2,438.7 |
| | $ | 3,214.1 |
| | $ | (478.9 | ) | | 2,735.2 |
| | | | | | | | | | | | | | Indefinite-Lived Intangible Assets: | | | | | | | | | | | | | Trade names | | | | | | 450.0 |
| | | | | | 578.0 |
| Foreign currency translation adjustments | | | | | | — |
| | | | | | (0.4 | ) | Total intangible assets – other, net | | | | | | $ | 2,888.7 |
| | | | | | $ | 3,312.8 |
| Trading products(2) | | | | | | $ | 17,040.5 |
| | | | | | $ | 17,040.5 |
|
| | (1) | At June 30, 2012, other amortizable intangible assets consisted of market maker agreements and a definite-lived trade name. At December 31, 2011, other amortizable intangible assets consisted of service and market maker agreements and a definite-lived trade name. |
| | (2) | Trading products represent futures and options products acquired in our business combinations with CBOT Holdings, Inc. (CBOT Holdings) and NYMEX Holdings, Inc. (NYMEX Holdings). Clearing and transaction fees revenues are generated through the trading of these products. These trading products, most of which have traded for decades, require authorization from the Commodity and Futures Trading Commission (CFTC). Product authorizations from the CFTC have no term limits. |
As part of its sale of the CBOT building, the company sold the rights to lease agreements with tenants in the north and south towers. The lease agreements, which are included in lease-related intangibles, had a net book value of $14.4 million on the date of sale. In the second quarter of 2012, the company contributed the DJI asset group to the venture with McGraw. Contributed intangible assets with an aggregate net book value of $336.3 million included rights to customer agreements, technology-related intellectual property and trade names. In addition, the company sold CMA-related intangible assets with a net book value of $9.4 million. Total amortization expense for intangible assets was $31.3 million and $33.0 million for the quarters ended June 30, 2012 and 2011, respectively. Total amortization expense for intangible assets was $64.1 million and $66.2 million for the first six months of 2012 and 2011, respectively. As of June 30, 2012, the future estimated amortization expense related to amortizable intangible assets is expected to be as follows. | | | | | (in millions) | Amortization Expense | Remainder of 2012 | $ | 51.2 |
| 2013 | 100.9 |
| 2014 | 99.6 |
| 2015 | 99.4 |
| 2016 | 96.0 |
| 2017 | 96.0 |
| Thereafter | 1,895.6 |
|
Goodwill activity consisted of the following for the six months ended June 30, 2012 and the year ended December 31, 2011: | | | | | | | | | | | | | | | | | | | | Balance at | | | | Other | | Balance at | (in millions) | | December 31, 2011 | | Divestitures | | Activity(3) | | June 30, 2012 | CBOT Holdings | | $ | 5,035.7 |
| | $ | — |
| | $ | — |
| | $ | 5,035.7 |
| NYMEX Holdings | | 2,462.2 |
| | — |
| | — |
| | 2,462.2 |
| Index Services | | 434.5 |
| | (434.5 | ) | | — |
| | — |
| Other | | 51.6 |
| | (28.9 | ) | | — |
| | 22.7 |
| Total goodwill | | $ | 7,984.0 |
| | $ | (463.4 | ) | | $ | — |
| | $ | 7,520.6 |
|
| | | | | | | | | | | | | | | | | | | | Balance at | | | | Other | | Balance At | (in millions) | | December 31, 2010 | | Divestitures | | Activity(3) | | December 31, 2011 | CBOT Holdings | | $ | 5,035.7 |
| | $ | — |
| | $ | — |
| | $ | 5,035.7 |
| NYMEX Holdings | | 2,462.3 |
| | — |
| | (0.1 | ) | | 2,462.2 |
| Index Services | | 435.6 |
| | — |
| | (1.1 | ) | | 434.5 |
| Other | | 50.0 |
| | — |
| | 1.6 |
| | 51.6 |
| Total goodwill | | $ | 7,983.6 |
| | $ | — |
| | $ | 0.4 |
| | $ | 7,984.0 |
|
| | (3) | Other activity includes adjustments to tax contingencies, the recognition of excess tax benefits upon exercise of stock options and foreign currency translation adjustments. |
In conjunction with the formation of the index business venture with McGraw, the company divested the goodwill allocated to Index Services and CMA reporting units. |