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ACQUISITIONS AND DISPOSITIONS (Tables)

3 Months Ended

Mar. 31, 2019

The following table presents the fair value of each class of consideration transferred at the Acquisition Date.



(in millions, except per share amounts)
Equivalent shares of Marriott Vacations Worldwide common stock issued in exchange for ILG outstanding shares	20.5
Marriott Vacations Worldwide common stock price per share as of Acquisition Date	$	119.00
Fair value of Marriott Vacations Worldwide common stock issued in exchange for ILG outstanding shares	2,441
Cash consideration to ILG shareholders, net of cash acquired of $154 million	1,680
Fair value of ILG equity-based awards attributed to pre-combination service	64
Total consideration transferred, net of cash acquired	4,185
Noncontrolling interests	29
	$	4,214

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table presents our preliminary estimates of the fair values of the assets that we acquired and the liabilities that we assumed on the Acquisition Date in connection with the business combination as previously reported at December 31, 2018. We had no changes to our preliminary estimates of fair value during the first quarter of 2019.



($ in millions)	September 1, 2018 (as reported at December 31, 2018)
Vacation ownership notes receivable	$	753
Inventory	474
Property and equipment	374
Intangible assets	1,166
Other assets	620
Deferred revenue	(217		)
Deferred taxes	(179		)
Debt	(392		)
Securitized debt from VIEs	(702		)
Other liabilities	(511		)
Net assets acquired	1,386
Goodwill⁽¹⁾	2,828
	$	4,214

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⁽¹⁾	Goodwill is calculated as total consideration transferred, net of cash acquired, less identified net assets acquired and it primarily represents the value that we expect to obtain from synergies and growth opportunities from our combined operations.

Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination

The following table presents our preliminary estimates of the fair values of ILG’s identified intangible assets and their related estimated useful lives as of the Acquisition Date.



	Estimated Fair Value ($ in millions)		Estimated Useful Life (in years)
Member relationships	$	695	15 to 20
Management contracts	356		15 to 25
Management contracts⁽¹⁾	33		indefinite
Trade names and trademarks	82		indefinite
	$	1,166

_________________________

⁽¹⁾

The indefinite-lived management contracts, by their terms, continue for the foreseeable horizon. There are no legal, regulatory, contractual, competitive, economic or other factors which limit the period of time over which these resort management contracts are expected to contribute future cash flows.

Business Acquisition, Pro Forma Information

The following table presents the results of Legacy-ILG operations included in our Income Statement for the three months ended March 31, 2019.



($ in millions)	Three Months Ended March 31, 2019
Revenue	$	458
Net income attributable to common shareholders	$	32

The following unaudited pro forma information presents the combined results of operations of Marriott Vacations Worldwide and ILG as if we had completed the ILG Acquisition on December 30, 2016, the last day of our 2016 fiscal year, but using our preliminary fair values of assets and liabilities as of the Acquisition Date. As required by GAAP, these unaudited pro forma results do not reflect any synergies from operating efficiencies. Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the ILG Acquisition had occurred at the beginning of the period presented, nor are they indicative of future results of operations.



($ in millions, except per share data)	Three Months Ended March 31, 2018
Revenues	$	1,047
Net income	$	46
Net income attributable to common shareholders	$	45
EARNINGS PER SHARE ATTRIBUTABLE TO COMMON SHAREHOLDERS
Basic	$	0.95
Diluted	$	0.92