Net Assets Held for Sale and Divested

6 Months Ended

Jun. 30, 2023

Discontinued Operations and Disposal Groups [Abstract]

The Company classifies assets and liabilities as held for sale (the “disposal group”) when management commits to a plan to sell the disposal group and meets all required criteria in ASC 360 Property, Plant, and Equipment. Assets held for sale are measured at the lower of their carrying amount or fair value less costs to sell. Any loss resulting from this measurement is recognized in the period the held for sale criteria are met. Gains are not recognized until realized on the date of sale. Long-lived assets classified as held for sale are not depreciated or amortized.

In June 2023, the Company entered into an agreement to sell its ValueFirst business, which operates an enterprise communications platform in India. The sale was subsequently completed in July 2023, and the Company received $45.5 million in cash. This divestiture allowed allocation of Company resources to other strategic priorities with a greater impact on the Company’s business. The divestiture did not represent a strategic shift in operations that would have a major effect on the Company's business and financial results, and therefore, is not presented as a discontinued operation.

The following table presents the major classes of assets and liabilities of the disposal group classified as held for sale as of June 30, 2023, in the accompanying condensed consolidated balance sheet:


	As of June 30, 2023
Assets held for sale:	(In thousands)
Total tangible assets	$	42,546



Intangible assets, net	17,294
Goodwill	34,604
Valuation allowance	(28,777)
Total assets held for sale	$	65,667





Total liabilities held for sale	$	25,075

The measurement of assets held for sale to fair value less costs to sell resulted in a loss of $28.8 million, which is recorded within general and administrative expenses in the accompanying condensed consolidated statements of operations for the three and six months ended June 30, 2023. The Company recorded a valuation allowance to reduce the carrying amount of the disposal group to its fair value less costs to sell in the accompanying condensed consolidated balance sheet. The Company also recorded an additional $3.1 million of divestiture expenses in the same period.

Separately, in the second quarter of 2023, the Company sold its Internet of Things (“IoT”) disposal group for stock consideration of $15.8 million. The loss on divestiture and related expenses recorded in the three and six months ended June 30, 2023 were not significant.