Note 10 — Equity Method Investments and Related Party Transactions

Eutelsat strategic partnering arrangement

In March 2017, the Company acquired a 49% interest in Euro Infrastructure Co. The Company’s investment in Euro Infrastructure Co. is accounted for under the equity method and the total investment, including basis difference allocated to tangible assets, identifiable intangible assets, deferred income taxes and goodwill, is classified as a single line item, as an investment in unconsolidated affiliate, on the Company’s consolidated balance sheets. The Company will record its proportionate share of the results of Euro Infrastructure Co., and any related basis difference amortization expense, within equity in earnings (losses) of unconsolidated affiliate, net, one quarter in arrears. Therefore, the Company’s share of the results of Euro Infrastructure Co. (from and after the date of the Company’s investment in Euro Infrastructure Co. on March 3, 2017) will be included in the Company’s consolidated financial statements commencing in the first quarter of fiscal year 2018. The Company’s investment in Euro Infrastructure Co. is presented at cost of investment plus its accumulated proportional share of income or loss less any distributions it has received.

The difference between the Company’s carrying value of its investment in Euro Infrastructure Co. and its proportionate share of the net assets of Euro Infrastructure Co. as of March 3, 2017 is summarized as follows:


	(In thousands)
Carrying value of investment in Euro Infrastructure Co.	$	141,894
Proportionate share of net assets of Euro Infrastructure Co		127,393

Excess carrying value of investment over proportionate share of net assets	$	14,501

The excess carrying value has been primarily assigned to:
Goodwill	$	20,791
Identifiable intangible assets		12,379
Tangible asset		(20,241	)
Deferred income taxes		1,572

	$	14,501

The identifiable intangible assets have useful lives up to 11 years and a weighted average useful life of approximately ten years, and tangible assets have useful lives up to 11 years and a weighted average useful life of approximately 11 years. The preliminary allocation is subject to revision as more detailed analysis is completed and additional information on the assets and liabilities of Euro Infrastructure Co. as of the closing date becomes available. Any change in the net assets of Euro Infrastructure Co. will change the amount of the purchase price allocable to goodwill. Goodwill is not deductible for tax purposes.

Related party transactions

Transactions with equity method investee are considered related party transactions. Related party transactions entered into between Euro Infrastructure Co. and its subsidiaries, on the one hand, and the Company and its subsidiaries, on the other hand, in the ordinary course of business for the period from and after the date of the Company’s investment in Euro Infrastructure Co. in March 2017 and as of March 31, 2017 were insignificant.