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Acquisitions | 6 Months Ended
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Jun. 30, 2018
Business Combinations [Abstract] |
Acquisitions | We account for acquisitions using the acquisition method of accounting, and, accordingly, the assets and liabilities acquired are recorded at their estimated fair values and the results of operations for each acquisition have been included in our consolidated results from their respective acquisition dates. a. Acquisition of IO Data Centers On January 10, 2018, we completed the acquisition of the United States operations of IODC, a leading data center colocation space and solutions provider based in Phoenix, Arizona, including the land and buildings associated with four data centers in Phoenix and Scottsdale, Arizona; Edison, New Jersey; and Columbus, Ohio (the “IODC Transaction”). At the closing of the IODC Transaction, we paid approximately $1,347,000. In addition to the amount paid at the closing of the IODC Transaction, there is the potential of $35,000 in additional payments associated with the execution of future customer contracts. We have accounted for the IODC Transaction as an acquisition of a business in accordance with the guidance in ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business. The unaudited consolidated pro forma financial information (the "Pro Forma Financial Information") below summarizes the combined results of us and IODC on a pro forma basis as if the IODC Transaction had occurred on January 1, 2017. The Pro Forma Financial Information is presented for informational purposes and is not necessarily indicative of the results of operations that would have been achieved if the acquisition had taken place on January 1, 2017. The Pro Forma Financial Information, for all periods presented, includes our current estimates of purchase accounting adjustments (including amortization expenses from acquired intangible assets and depreciation of acquired property, plant and equipment). We and IODC have collectively incurred $28,064 of operating expenditures to complete the IODC Transaction (including advisory and professional fees). These operating expenditures have been reflected within the results of operations in the Pro Forma Financial Information as if they were incurred on January 1, 2017.
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2017 |  | 2018 |  | 2017 |  | 2018
Total Revenues | $ | 983,723 |  |  | $ | 1,060,823 |  |  | $ | 1,957,480 |  |  | $ | 2,106,752 |
Income from Continuing Operations | $ | 76,085 |  |  | $ | 94,242 |  |  | $ | 93,516 |  |  | $ | 149,423 |
Per Share Income from Continuing Operations - Basic | $ | 0.26 |  |  | $ | 0.33 |  |  | $ | 0.32 |  |  | $ | 0.52 |
Per Share Income from Continuing Operations - Diluted | $ | 0.26 |  |  | $ | 0.33 |  |  | $ | 0.32 |  |  | $ | 0.52 |
In addition to our acquisition of IODC, we completed certain other acquisitions during 2017 and 2018. The Pro Forma Financial Information does not reflect these acquisitions due to the insignificant impact of these acquisitions on our consolidated results of operations. b. Other Noteworthy Acquisitions On March 8, 2018, in order to expand our data center operations into Europe and Asia, we acquired the operations of two data centers in London and Singapore from Credit Suisse International and Credit Suisse AG (together, "Credit Suisse") for a total of (i) 34,600 British pounds sterling and (ii) 81,000 Singapore dollars (or collectively, approximately $111,400, based upon the exchange rates between the United States dollar and the British pound sterling and Singapore dollar on the closing date of the Credit Suisse transaction) (the “Credit Suisse Transaction”). As part of the Credit Suisse Transaction, Credit Suisse entered into a long-term lease with us to maintain existing data center operations. On May 25, 2018, in order to further expand our data center operations in Europe, we acquired EvoSwitch Netherlands B.V. and EvoSwitch Global Services B.V. (collectively, "EvoSwitch"), a leading data center colocation space and solutions provider with a data center in Amsterdam (the "EvoSwitch Transaction"), for (i) cash consideration of 189,000 Euros (or approximately $222,000, based upon the exchange rate between the Euro and the United States dollar on the closing date of the EvoSwitch Transaction) and (ii) $25,000 of additional consideration in the form of future services we will provide to the seller, which is included in purchase price holdbacks and other in the allocation of the purchase price paid table below. In November 2017, we entered into an agreement to acquire (i) the storage and information management assets and operations of Santa Fe Group A/S ("Santa Fe") in China (the “Santa Fe China Transaction”) for approximately 14,000 Euros and (ii) certain real estate property located in Beijing, China owned by Santa Fe (the “Beijing Property”) for approximately 9,000 Euros, representing a total purchase price of approximately 23,000 Euros, subject to customary purchase price adjustments. We closed on the Santa Fe China Transaction on December 29, 2017. The purchase price for the Santa Fe China Transaction was not paid until January 2018 and, therefore, we accrued for the purchase price of the Santa Fe China Transaction (which was approximately $16,800, based upon the exchange rate between the Euro and the United States dollar on the closing date of the Santa Fe China Transaction) in our Consolidated Balance Sheet as of December 31, 2017 (the “Accrued Purchase Price”). The Accrued Purchase Price is presented as a component of the current portion of long-term debt in our Consolidated Balance Sheet as of December 31, 2017. We paid the purchase price of the Santa Fe China Transaction on January 3, 2018. We expect to close on the acquisition of the Beijing Property during the second half of 2018. The completion of the acquisition of the Beijing Property is subject to closing conditions; accordingly, we can provide no assurances that we will be able to complete the acquisition of the Beijing Property, that it will not be delayed or that the terms will remain the same. A summary of the cumulative consideration paid and the preliminary allocation of the purchase price paid for all of our 2018 acquisitions through June 30, 2018 is as follows:
|  | IODC Transaction |  | Other Fiscal Year 2018 Acquisitions (excluding IODC) |  | Total
Cash Paid (gross of cash acquired)(1) |  | $ | 1,347,046 |  |  | $ | 347,357 |  |  | $ | 1,694,403 |
Purchase Price Holdbacks and Other |  | — |  |  | 26,089 |  |  | 26,089 |
Total Consideration |  | 1,347,046 |  |  | 373,446 |  |  | 1,720,492 |
Fair Value of Identifiable Assets Acquired: |  |  |  |  |  |
Cash |  | 34,227 |  |  | 484 |  |  | 34,711 |
Accounts Receivable and Prepaid Expenses |  | 7,070 |  |  | 3,354 |  |  | 10,424 |
Property, Plant and Equipment(2) |  | 863,027 |  |  | 195,470 |  |  | 1,058,497 |
Customer Relationship Intangible Assets |  | — |  |  | 7,254 |  |  | 7,254 |
Data Center In-Place Leases |  | 104,340 |  |  | 32,091 |  |  | 136,431 |
Data Center Tenant Relationships |  | 77,362 |  |  | 18,410 |  |  | 95,772 |
Data Center Above-Market Leases |  | 16,439 |  |  | 2,381 |  |  | 18,820 |
Other Assets |  | — |  |  | 273 |  |  | 273 |
Debt Assumed |  | — |  |  | (19,941 | ) |  | (19,941 | )
Accounts Payable, Accrued Expenses and Other Liabilities |  | (23,198 | ) |  | (2,197 | ) |  | (25,395 | )
Deferred Income Taxes |  | — |  |  | (31,761 | ) |  | (31,761 | )
Data Center Below-Market Leases |  | (11,421 | ) |  | (694 | ) |  | (12,115 | )
Other Liabilities |  | — |  |  | (1,176 | ) |  | (1,176 | )
Total Fair Value of Identifiable Net Assets Acquired |  | 1,067,846 |  |  | 203,948 |  |  | 1,271,794 |
Goodwill Initially Recorded(3) |  | $ | 279,200 |  |  | $ | 169,498 |  |  | $ | 448,698 |
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(1) | Included in cash paid for acquisitions in the Condensed Consolidated Statement of Cash Flows for the six months ended June 30, 2018 is net cash acquired of $34,711 and contingent and other payments, net of $7,177 related to acquisitions made in previous years. The cash paid for the Accrued Purchase Price for the Santa Fe China Transaction is included in cash flows from financing activities (as a component of repayment of revolving credit, term loan and bridge facilities and other debt) in the Condensed Consolidated Statement of Cash Flows for the six months ended June 30, 2018.
(2) | Consists primarily of building, building improvements, leasehold improvements, data center infrastructure, racking structures and warehouse equipment. These assets are depreciated using the straight-line method with the useful lives as noted in Note 2.g. to Notes to Consolidated Financial Statements included in our Annual Report.
(3) The goodwill associated with acquisitions is primarily attributable to the assembled workforce, expanded market opportunities and costs and other operating synergies anticipated upon the integration of the operations of us and the acquired businesses. See Note 6 to Notes to Consolidated Financial Statements included in our Annual Report for additional information regarding our allocations of the purchase price for acquisitions. The preliminary purchase price allocations that are not finalized as of June 30, 2018 primarily relate to the final assessment of the fair values of intangible assets (primarily customer relationship intangible assets and data center lease-based intangible assets), property, plant and equipment (primarily building, building improvements, data center infrastructure and racking structures), operating leases, contingencies and income taxes (primarily deferred income taxes), primarily associated with the Bonded Transaction, the Santa Fe Transaction, the Fortrust Transaction (each as defined in Note 6 to Notes to Consolidated Financial Statements included in our Annual Report), the IODC Transaction, the Credit Suisse Transaction and the EvoSwitch Transaction, as well as other acquisitions we closed in 2018. As the valuation of certain assets and liabilities for purposes of purchase price allocations are preliminary in nature, they are subject to adjustment as additional information is obtained about the facts and circumstances regarding these assets and liabilities that existed at the acquisition date. Any adjustments to our estimates of purchase price allocation will be made in the periods in which the adjustments are determined and the cumulative effect of such adjustments will be calculated as if the adjustments had been completed as of the acquisition dates. Adjustments recorded during the six months ended June 30, 2018 were not material to our results from operations.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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