Asterias Merger (Tables)

6 Months Ended

Jun. 30, 2020

Business Combinations [Abstract]

Schedule of Merger Consideration Transferred

The calculation of the purchase price for the Asterias Merger and the Merger Consideration transferred on March 8, 2019 was as follows (in thousands, except for share and per share amounts):

	Lineage (38% ownership interest)			Shareholders other than Lineage (approximate 62% ownership interest)			Total
Outstanding Asterias common stock as of March 8, 2019		21,747,569			34,783,333	(1)		56,530,902	(1)
Exchange ratio		0.710			0.710			0.710
Lineage common shares issuable		15,440,774	(2)		24,695,898	(3)		40,136,672
Per share price of Lineage common shares as of March 8, 2019	$	1.31		$	1.31		$	1.31
Purchase price (in $000s)	$	20,227	(2)	$	32,353		$	52,580

(1)	Includes 81,810 shares of Asterias restricted stock unit awards that immediately vested on March 8, 2019 and converted into the right to receive common shares of Lineage based on the Merger Exchange Ratio, resulting in 58,085 common shares of Lineage issued on March 8, 2019 as part of the Merger Consideration. These restricted stock units were principally attributable to pre-combination services and included as part of the purchase price in accordance with ASC 805. See Note 12 for Asterias restricted stock units that vested on the closing of the Asterias Merger attributable to post-combination services that were recorded outside of the purchase price as an immediate charge to stock-based compensation expense.
(2)	Estimated fair value for Lineage’s previously held 38% ownership interest in Asterias common stock is part of the total purchase price of Asterias for purposes of the purchase price allocation under ASC 805 and for Lineage’s adjustment of its 38% interest to fair value at the effective date of the Asterias Merger and immediately preceding the consolidation of Asterias’ results with Lineage. No actual common shares of Lineage were issued to Lineage in connection with the Asterias Merger.
(3)	Net of a de minimis number of fractional shares which were paid in cash.

Schedule of Identifiable Tangible and Intangible Assets Acquired and Liabilities Assumed

The allocation of the purchase price in the table below is based on our estimates of the fair values of tangible and intangible assets acquired, including IPR&D, and liabilities assumed as of the acquisition date, with the excess recorded as goodwill (in thousands). As of December 31, 2019, Lineage had finalized its purchase price allocation.

Assets acquired:
Cash and cash equivalents	$	3,117
Prepaid expenses and other assets, current and noncurrent		660
Machinery and equipment		308
Long-lived intangible assets - royalty contracts		650
Acquired in-process research and development (“IPR&D”)		46,540
Total assets acquired		51,275
Liabilities assumed:
Accrued liabilities and accounts payable		982
Liability classified warrants		867
Deferred license revenue		200
Long-term deferred income tax liability		10,753
Total liabilities assumed		12,802
Net assets acquired, excluding goodwill (a)		38,473
Fair value of Lineage common shares held by Asterias (b)		3,435
Total purchase price (c)		52,580
Estimated goodwill (c-a-b)	$	10,672

Schedule of Valuation of Identifiable Intangible Assets and Their Estimated Useful Lives

The valuation of identifiable intangible assets and their estimated useful lives are as follows (in thousands, except for useful life):

	Asset Fair Value		Useful Life (Years)
	(in thousands, except for useful life)
In process research and development (“IPR&D”)	$	46,540		n/a
Royalty contracts		650		5
	$	47,190