Discontinued Operations

12 Months Ended

Jan. 30, 2016

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations

Discontinued operations comprise the following:

Domestic Segment

During the fourth quarter of fiscal 2014, we completed the sale of mindSHIFT to Ricoh Americas Corporation, at which time we recorded an $18 million pre-tax loss.

International Segment

Five Star - During the fourth quarter of fiscal 2015, we entered into a definitive agreement to sell our Five Star business to Yingtan City Xiangyuan Investment Limited Partnership and Zhejiang Jiayuan Real Estate Group Co. On February 13, 2015, we completed the sale of Five Star and recognized a gain on sale of $99 million. Following the sale of Five Star, we continue to hold one retail property in Shanghai, China, which remains held for sale at January 30, 2016, as we continue to actively market the property. The assets of this property are classified as held for sale in the Consolidated Balance Sheets and were $31 million as of January 30, 2016. The presentation of discontinued operations has been retrospectively applied to all prior periods presented.

The composition of assets and liabilities disposed of as a result of the sale of Five Star was as follows ($ in millions):

	February 13, 2015
Cash and cash equivalents	$	125
Receivables	113
Merchandise inventories	252
All other assets	461
Total assets	$	951
Accounts payable	$	478
All other liabilities	128
Total liabilities	$	606

Best Buy Europe – During the second quarter of fiscal 2014, we completed the sale of our 50% ownership interest in Best Buy Europe to CPW in return for the following consideration upon closing: net cash of £341 million ($526 million); £80 million ($123 million) of ordinary shares of CPW; £25 million ($39 million), plus 2.5% interest, to be paid by CPW on June 26, 2014; and £25 million ($39 million), plus 2.5% interest, to be paid by CPW on June 26, 2015. We subsequently sold the ordinary shares of CPW for $123 million on July 3, 2013. We received the first such deferred cash payment on June 26, 2014 and the second deferred cash payment on June 26, 2015.

In conjunction with our agreement to sell our 50% ownership interest in Best Buy Europe, we entered into a deal-contingent foreign currency forward contract to hedge £455 million of the total £471 million of net proceeds. The contract was settled in cash following the completion of the sale on June 26, 2013, and we recognized a $2 million loss in gain (loss) from discontinued operations on our Consolidated Statements of Earnings in fiscal 2014.

The aggregate financial results of all discontinued operations for fiscal 2016, 2015 and 2014 were as follows ($ in millions):

	2016			2015			2014
Revenue	$	217		$	1,564		$	4,615
Restructuring charges(1)	1			18			110
Loss from discontinued operations before income tax benefit (expense)(2)	(8		)	(12		)	(235		)
Income tax benefit (expense)(3)	(1		)	—			31
Gain on sale of discontinued operations(4)	99			1			32
Net earnings (loss) from discontinued operations including noncontrolling interests	90			(11		)	(172		)
Net (earnings) loss from discontinued operations attributable to noncontrolling interests	—			(2		)	9
Net earnings (loss) from discontinued operations attributable to Best Buy Co., Inc. shareholders	$	90		$	(13	)	$	(163	)

(1) See Note 4, Restructuring Charges, for further discussion of the restructuring charges associated with discontinued operations.

(2) Includes a $175 million impairment to write down the book value of our investment in Best Buy Europe to fair value in fiscal 2014.

(3) Income tax benefit for fiscal 2014 includes a $27 million benefit related to a tax allocation between continuing and discontinued operations and a $15 million benefit related to the impairment of our investment in Best Buy Europe. The fiscal 2014 effective tax rate for discontinued operations differs from the statutory tax rate primarily due to the previously mentioned tax allocation, sale of mindSHIFT, restructuring charges and the impairment of our investment in Best Buy Europe. The sale of mindSHIFT, restructuring charges and impairment generally included no related tax benefit. The deferred tax assets related to the sale of mindSHIFT and restructuring charges generally resulted in an increase in the valuation allowance in an equal amount, of which the investment impairment is not tax deductible.

(4) Gain in fiscal 2014 is primarily comprised of the following: $28 million gain (with no tax impact) from sale of Best Buy Europe fixed-line business in Switzerland in the first quarter; $24 million gain (with no tax impact) from the sale of Best Buy Europe in the second quarter; and loss of $18 million from sale of mindSHIFT in the fourth quarter. Gain in fiscal 2016 of $99 million is from sale of Five Star in the first quarter.