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Acquisitions
 9 Months Ended
Sep. 30, 2013
Notes to Financial Statements [Abstract]  
Acquisitions

Note 5 – Acquisitions

 

We acquired 100% of the capital stock of Brazil-based Rede Transacoes Eletronicas Ltda. (Rede Trel) on January 31, 2013. The purchase price of approximately $27.7 million included $25.9 million in cash and the $1.8 million acquisition-date fair value of contingent consideration. On the acquisition date, Rede Trel had $10 million of cash and cash equivalents that it uses as working capital, resulting in a net cash outflow of $16 million related to the acquisition. Rede Trel distributes electronic prepaid products, including mobile phone airtime, via a network of approximately 20,000 retail locations across Brazil. Rede Trel's strong distribution network supplements Brink's existing payments business, ePago, which has operations in Brazil, Mexico, Colombia and Panama.

 

We have provisionally estimated fair values for the assets purchased and liabilities assumed as of the date of the acquisition in the following table. The determination of estimated fair value required management to make significant estimates and assumptions. The amounts reported are considered provisional as we are completing the valuations that are required to allocate the purchase price. As a result, the allocation of the purchase price and the amount of goodwill and intangible assets may change in the future.

     
   Estimated Fair 
   Value at 
 (In millions) January 31, 2013 
     
 Fair value of purchase consideration   
     
 Cash paid for 100% of shares$25.9 
 Fair value of contingent consideration 1.8 
 Fair value of purchase consideration$27.7 
     
     
 Fair value of net assets acquired   
     
 Cash$10.0 
 Accounts receivable 7.8 
 Other current assets 19.9 
 Property and equipment 4.0 
 Intangible assets(a) 11.8 
 Goodwill(b) 14.0 
 Current liabilities (38.8) 
 Noncurrent liabilities (1.0) 
 Fair value of net assets acquired$27.7 

  • Intangible assets are primarily comprised of agent relationships and contractual agreements with the major Brazilian telecommunications companies. Final allocation will be determined once the valuation is complete.
  • Consists of intangible assets that do not qualify for separate recognition, combined with synergies expected from integrating Rede Trel's distribution network into our existing ePago business. All of the goodwill has been assigned to the Latin America reporting unit and is expected to be deductible for tax purposes.

 

We acquired the remaining 26% ownership interest in our cash logistics business in Chile for approximately $18 million in cash on January 10, 2013.  We now own 100% of this business.