Acquisitions

12 Months Ended

Jan. 31, 2020

During the fiscal year ended January 31, 2020, we completed two acquisitions, Crossix and Physicians World, both of which were accounted for as business combinations. The goodwill recognized for these acquisitions was primarily attributable to expected synergies from the integration with our products and services and is not deductible for U.S. tax purposes.

Crossix

On November 1, 2019, we acquired 100% ownership of Crossix in exchange for total consideration of $427.9 million, which includes the impact of adjustments to purchase price associated with the cash and net working capital of the acquired entity at close. In addition, we granted certain Crossix employees equity retention awards valued at approximately $120 million in the aggregate, which will be expensed as share-based compensation over the remaining service period. Crossix brings Veeva additional depth in patient data and data analytics, and we are integrating Crossix with our Veeva CRM and OpenData products. We incurred $1.0 million in acquisition-related transaction costs which are reflected in general and administrative expenses on our consolidated statements of comprehensive income.

The fair value of assets acquired and liabilities assumed was based on a preliminary valuation, and our estimates and assumptions are subject to change within the measurement period. The area that is subject to change relates to certain tax-related items.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands):



	Useful lives of intangible assets	Fair value
Net assets acquired		$	4,766

Identifiable intangible assets:
Customer relationships	10 years	$	70,100
Existing technology	6 years	19,200
Trade name/Trademarks	5 years	13,200
Other intangibles	1 to 7 years	6,000
Purchased intangible assets		$	108,500

Goodwill		$	314,642

Total purchase consideration		$	427,908

The following unaudited pro forma information presents the combined results of operations for the periods presented as if the acquisition had been completed on February 1, 2018, the beginning of the comparable prior annual reporting period. The unaudited pro forma results include the amortization associated with estimates for the purchased intangible assets and stock-based compensation expense associated with the retention awards granted.

The unaudited pro forma results do not reflect any cost saving synergies from operating efficiencies or the effect of the incremental costs incurred in integrating the two companies. Accordingly, these unaudited pro forma results are presented for information purpose only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisition had occurred at the beginning of the period presented, nor are they indicative of future results of operations (in thousands):



	For the fiscal year ended January 31,
	2020		2019
	(Unaudited)
Pro forma revenues	$	1,153,497	$	913,081
Pro forma net income	$	278,215	$	201,382
Pro forma net income per share:
Basic	$	1.88	$	1.40
Diluted	$	1.76	$	1.29

Physicians World

On November 7, 2019, we completed our acquisition of Physicians World in exchange for total cash consideration of $41.0 million, which includes the impact of adjustments to purchase price associated with the cash and net working capital of the acquired entity at close. In addition, we granted certain Physicians World employees equity retention awards valued at approximately $15 million in the aggregate. Acquiring Physicians World makes it easier for our customers to get industry leading cloud software and services from a single vendor. We incurred $0.3 million in acquisition-related transaction costs which are reflected in general and administrative expenses on our consolidated statements of comprehensive income.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands):



	Useful lives of intangible assets	Fair value
Net assets acquired		$	1,221

Identifiable intangible assets:
Customer relationships	10 years	$	7,700
Existing technology	6 years	3,300
Trade name/Trademarks	3 years	700
Purchased intangible assets		$	11,700

Goodwill		$	28,083

Total purchase price		$	41,004

Pro forma results of operations have not been presented because the effect of this acquisition was not material to the consolidated financial statements.