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Acquisitions, Goodwill, and Other Intangible Assets (Narrative) (Details)
3 Months Ended 12 Months Ended
Feb. 06, 2023
USD ($)
Jun. 01, 2022
USD ($)
Sep. 03, 2021
USD ($)
Dec. 31, 2022
USD ($)
Sep. 30, 2022
USD ($)
Dec. 31, 2023
USD ($)
segments
Dec. 31, 2022
USD ($)
Dec. 31, 2021
USD ($)
Business Acquisition [Line Items]                
Impairment of intangible assets           $ 0 $ 0 $ 0
Deferred tax liability     $ (3,200,000)          
Goodwill       $ 1,571,700,000   1,578,800,000 1,571,700,000 1,207,000,000
Goodwill impairment loss           0 0 $ 0
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities     3,200,000          
Contingent consideration liability       50,000,000.0   $ 0 50,000,000.0  
Payment for Contingent Consideration Liability, Operating Activities   $ 50,000,000            
Goodwill and Intangible Assets Disclosure           Acquisitions, Goodwill, and Other Intangible Assets
2023 Acquisitions

We did not make any significant acquisitions during 2023.

2022 Acquisitions

Leveraged Commentary & Data (LCD)

On June 1, 2022, we completed our acquisition of LCD, a market leader in news, research, data, insights, and indexes for the leveraged finance market, from S&P for an initial cash payment of $600.0 million plus a contingent payment of up to $50.0 million. We began consolidating the financial results of LCD in our consolidated financial statements as of June 1, 2022.

The total consideration transferred was recorded as $645.5 million, comprised of a $600.0 million cash payment plus contingent consideration with an acquisition date fair value of $45.5 million.

The transaction was accounted for as a business combination under the acquisition method of accounting pursuant to FASB ASC 805, which requires that assets acquired and liabilities assumed be recognized at fair value as of the acquisition date. We finalized the purchase price allocation related to our acquisition of LCD during the second quarter of 2023 and did not record any significant adjustments compared to the preliminary estimates at the date of acquisition.

The final contingent consideration was determined based upon the achievement of certain conditions related to the separation of LCD’s contractual relationships from S&P contracts that include other S&P products and services during the six-month period following closing. To estimate the fair value of the contingent consideration at the acquisition date, we calculated the weighted average of the estimated contingent payment scenarios. At subsequent balance sheet dates, the contingent consideration was measured at fair value and any changes in the estimate were recorded in earnings unless the change in fair value was the result of facts and circumstances that existed as of the acquisition date. During the third and fourth quarters of 2022, the contingent consideration was remeasured and increased by $0.9 million and $3.6 million, respectively, for total consideration of $50.0 million as of December 31, 2022. The contingent consideration is classified as "Contingent consideration liabilities" on our Consolidated Balance Sheet as of December 31, 2022. On February 6, 2023, we made a cash payment of $50.0 million, resolving our contingent consideration liability related to our acquisition of LCD.

The following table summarizes our allocation of the estimated fair values of the assets acquired and liabilities assumed at the acquisition date:
(in millions)
Fair value of consideration$645.5 
Accounts receivable and other current assets$9.7 
Intangible assets, net275.6 
Deferred revenue(25.8)
Total fair value of net assets acquired$259.5 
Goodwill$386.0 

Acquired accounts receivable were recorded at gross contractual amounts receivable, which approximates fair value. We collected substantially all of the gross contractual amounts receivable within a reasonable period of time after the acquisition date.
The allocation of the estimated fair values of the assets acquired and liabilities assumed includes $275.6 million of acquired intangible assets, as follows:
(in millions)Weighted average useful life (years)
Customer-related assets$197.3 20
Technology-based assets65.7 10
Intellectual property12.6 10
Total intangible assets$275.6 

Goodwill of $386.0 million represents the excess over the fair value of the net tangible and intangible assets acquired. Since LCD was an asset acquisition, goodwill is deductible for income tax purposes for that transaction.

Praemium Portfolio Services Limited (Praemium)

On June 30, 2022, we completed our acquisition of Praemium, a U.K.-based global provider of digital-first financial services, with $44.9 million in cash paid at closing, subject to post-closing adjustments. Praemium and its subsidiaries offer several investment platforms and customer relationship management services to their financial planning and wealth management clients across the U.K. and international markets. We began consolidating the financial results of Praemium in our consolidated financial statements as of June 30, 2022.

The transaction was accounted for as a business combination under the acquisition method of accounting pursuant to FASB ASC 805, which requires that assets acquired and liabilities assumed be recognized at fair value as of the acquisition date. We finalized the purchase price allocation related to our acquisition of Praemium during the second quarter of 2023 and did not record any significant adjustments compared to the preliminary estimates at the date of acquisition.

The following table summarizes our allocation of the estimated fair values of the assets acquired and liabilities assumed at the acquisition date:
(in millions)
Fair value of consideration transferred$44.9 
Cash and cash equivalents$5.5 
Accounts receivable and other current and non-current assets3.3 
Intangible assets, net22.1 
Deferred revenue(0.3)
Deferred tax liability, net(5.4)
Other current and non-current liabilities(2.2)
Total fair value of net assets acquired$23.0 
Goodwill$21.9 

Acquired accounts receivable were recorded at gross contractual amounts receivable, which approximates fair value. We collected substantially all of the gross contractual amounts receivable within a reasonable period of time after the acquisition date.
The allocation of the estimated fair values of the assets acquired and liabilities assumed includes $22.1 million of acquired intangible assets, as follows:
(in millions)Weighted average useful life (years)
Customer-related assets$2.9 10
Technology-based assets19.2 10
Total intangible assets$22.1 

Goodwill of $21.9 million represents the excess over the fair value of the net tangible and intangible assets acquired. Goodwill is not deductible for income tax purposes for that transaction.

We recognized a net deferred tax liability of $5.4 million primarily because the amortization expense related to certain intangible assets is not deductible for income tax purposes.

2021 Acquisitions

Moorgate Benchmarks

On September 3, 2021, we acquired Moorgate Benchmarks (Moorgate), a privately held European-based global provider of index design, calculation, and administration. We began consolidating the financial results of Moorgate in our consolidated financial statements on September 3, 2021.

The transaction has been accounted for as a business combination using the acquisition method of accounting, which requires that assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. We finalized the purchase price allocation related to our acquisition of Moorgate during the fourth quarter of 2021 and did not record any significant adjustments compared to the preliminary estimates at the date of acquisition.

The allocation of the estimated fair values of the assets acquired and liabilities assumed includes $14.9 million of goodwill and $13.4 million of acquired intangible assets, as follows:
(in millions)Weighted average useful life (years)
Technology-based assets$12.1 7
Customer-related assets1.3 5
Total intangible assets$13.4 

We recognized a net deferred tax liability of $3.2 million primarily because the amortization expense related to certain intangible assets is not deductible for income tax purposes.
Goodwill
 
As disclosed in Note 2, the company revised its presentation of reportable segments in accordance with FASB ASC 280. The company concluded that it has seven operating segments, which are presented as the five following reportable segments: Morningstar Data and Analytics, PitchBook, Morningstar Wealth, Morningstar Credit, and Morningstar Retirement. The company's operating segments also represent the company's reporting units to which goodwill is assigned. The company allocated goodwill by reporting unit in accordance with FASB ASC 350. Under the new reporting unit structure, the consolidated goodwill balance is initially allocated based on each reporting unit's relative fair value. The company used a market approach and assigned goodwill to the reporting units. The following table shows the changes in our goodwill balances from January 1, 2022 to December 31, 2023:

 (in millions)Morningstar Data and AnalyticsPitchBookMorningstar WealthMorningstar CreditMorningstar RetirementTotal Reportable SegmentsCorporate and All OtherTotal
Balance as of
January 1, 2022
$609.1 $221.4 $71.6 $130.4 $93.5 $1,126.0 $81.0 $1,207.0 
Acquisition of LCD— 386.0 — — — 386.0 — 386.0 
Acquisition of Praemium— — 21.9 — — 21.9 — 21.9 
Other, primarily foreign currency translation(8.8)— (0.5)(23.5)— (32.8)(10.4)(43.2)
Balance as of December 31, 2022600.3 607.4 93.0 106.9 93.5 1,501.1 70.6 1,571.7 
Foreign currency translation5.2 — 1.2 1.7 — 8.1 (1.0)7.1 
Balance as of December 31, 2023$605.5 $607.4 $94.2 $108.6 $93.5 $1,509.2 $69.6 $1,578.8 

We did not record any impairment losses in 2023, 2022, or 2021 as the estimated fair value of our reporting unit exceeded its carrying value and we did not note any indicators of impairment. We perform our annual impairment testing during the fourth quarter of each year.

Intangible Assets

The following table summarizes our intangible assets: 
 As of December 31, 2023As of December 31, 2022
(in millions)GrossAccumulated
Amortization
NetWeighted
Average
Useful  Life
(years)
GrossAccumulated
Amortization
NetWeighted
Average
Useful  Life
(years)
Customer-related assets$601.7 $(263.8)$337.9 14$595.1 $(221.3)$373.8 14
Technology-based assets315.3 (197.0)118.3 8312.8 (173.8)139.0 8
Intellectual property & other 93.2 (65.0)28.2 892.1 (56.3)35.8 8
Total intangible assets$1,010.2 $(525.8)$484.4 12$1,000.0 $(451.4)$548.6 12
 
The following table summarizes our amortization expense related to intangible assets:

(in millions)202320222021
Amortization expense$70.5 $66.7 $62.0 
 
We did not record any impairment losses involving intangible assets in 2023, 2022, or 2021. We amortize intangible assets using the straight-line method over their expected economic useful lives.

Based on acquisitions completed through December 31, 2023, we expect intangible amortization expense for 2024 and subsequent years to be as follows:
 (in millions)
2024$65.5 
202557.2 
202653.4 
202746.1 
202842.1 
Thereafter220.1 
Total$484.4 

Our estimates of future amortization expense for intangible assets may be affected by additional acquisitions, divestitures, changes in the estimated useful lives, impairments, and foreign currency translation.
   
Contingent consideration liability       50,000,000.0   $ 0 50,000,000.0  
Payment for Contingent Consideration Liability, Operating Activities   50,000,000            
Finite-Lived Intangible Assets [Line Items]                
Number of Reportable Segments | segments           5    
Moorgate                
Business Acquisition [Line Items]                
Goodwill, Acquired During Period     14,900,000          
Finite-lived Intangible Assets Acquired     13,400,000          
Goodwill, Acquired During Period     14,900,000          
Finite-Lived Intangible Assets [Line Items]                
Finite-lived Intangible Assets Acquired     13,400,000          
Moorgate | Technology-based assets [Member]                
Business Acquisition [Line Items]                
Finite-lived Intangible Assets Acquired     $ 12,100,000          
Acquired Finite-Lived Intangible Assets, Weighted Average Useful Life     7 years          
Finite-Lived Intangible Assets [Line Items]                
Finite-lived Intangible Assets Acquired     $ 12,100,000          
Moorgate | Customer-related intangible assets [Member]                
Business Acquisition [Line Items]                
Finite-lived Intangible Assets Acquired     $ 1,300,000          
Acquired Finite-Lived Intangible Assets, Weighted Average Useful Life     5 years          
Finite-Lived Intangible Assets [Line Items]                
Finite-lived Intangible Assets Acquired     $ 1,300,000          
LCD                
Business Acquisition [Line Items]                
Cash paid to acquire the entity   600,000,000            
Consideration   645,500,000            
Goodwill, Acquired During Period   386,000,000.0         386,000,000.0  
Finite-lived Intangible Assets Acquired   275,600,000            
Contingent consideration liability   45,500,000            
Payment for Contingent Consideration Liability, Operating Activities $ 50,000,000 50,000,000            
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability       3,600,000 $ 900,000      
Goodwill, Acquired During Period   386,000,000.0         $ 386,000,000.0  
Contingent consideration liability   45,500,000            
Payment for Contingent Consideration Liability, Operating Activities $ 50,000,000 50,000,000            
Business Combination, Contingent Consideration Arrangements, Change in Amount of Contingent Consideration, Liability       $ 3,600,000 $ 900,000      
Finite-Lived Intangible Assets [Line Items]                
Finite-lived Intangible Assets Acquired   275,600,000            
LCD | Technology-based assets [Member]                
Business Acquisition [Line Items]                
Finite-lived Intangible Assets Acquired   $ 65,700,000            
Acquired Finite-Lived Intangible Assets, Weighted Average Useful Life   10 years            
Finite-Lived Intangible Assets [Line Items]                
Finite-lived Intangible Assets Acquired   $ 65,700,000            
LCD | Customer-related intangible assets [Member]                
Business Acquisition [Line Items]                
Finite-lived Intangible Assets Acquired   $ 197,300,000            
Acquired Finite-Lived Intangible Assets, Weighted Average Useful Life   20 years            
Finite-Lived Intangible Assets [Line Items]                
Finite-lived Intangible Assets Acquired   $ 197,300,000