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Acquisitions (Notes) | 12 Months Ended
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Dec. 31, 2020
Business Combinations [Abstract] |
Business Combination Disclosure [Text Block] | Acquisitions Acxiom Acquisition On October 1, 2018, pursuant to the terms of the Membership Interest Purchase Agreement dated as of July 2, 2018, the Company completed the acquisition of Acxiom Holdings, Inc.’s Marketing Solutions business ("Acxiom") through the acquisition of 100% of the equity interests of Acxiom for $2,327.9, subject to customary closing adjustments. The purpose of the acquisition is to combine the Company's media, creative, marketing services and analytics capabilities, global scale and consumer insights, with Acxiom's expertise in identity, data, integrations and data stewardship. The Company funded the acquisition of Acxiom from a term loan agreement with third-party lenders for $500.0 and unsecured senior notes issued for a total of $2,000.0 in aggregate principal amount. The following table summarizes the fair values of the assets acquired and liabilities assumed at the closing date:
| October 1, 2018
Cash and cash equivalents | $ | 13.3 |
Accounts receivable | 112.9 |
Accounts receivable, billable to clients | 8.3 |
Other current assets | 28.2 |
Property and equipment, net | 159.7 |
Deferred income taxes | (0.6) |
Goodwill | 1,110.8 |
Intangible assets, net | 995.0 |
Other non-current assets | 8.3 |
Accounts payable | (37.1) |
Accrued liabilities | (46.9) |
Contract liabilities | (23.2) |
Other non-current liabilities | (0.8) |
Net assets acquired | $ | 2,327.9 |
The fair values of the identifiable intangible assets acquired at the closing date are as follows:
| Fair Value |  | Weighted Average Amortization Period (Years)
Customer lists | $ | 600.0 |  |  | 15.0
Know-how and technology | 235.0 |  |  | 9.0
Trade names | 160.0 |  |  | 15.0 to indefinite
Total intangible assets | $ | 995.0 |  |  |
The fair value of the customer lists was determined by applying the multi-period excess earnings method, a variation of the income approach. The fair values of the know-how and technology and the trade names were determined using the relief from royalty method of the income approach. Goodwill generated by the Acxiom acquisition, the majority of which is tax deductible, primarily relates to intangible assets that do not qualify for separate recognition, including assembled workforce and synergies. The purchase accounting for the transaction was finalized during the third quarter of 2019, including the assignment of goodwill related to the transaction-associated synergies. There were no material adjustments to the preliminary amounts recorded. The operating results of Acxiom for the period from October 1, 2018 to December 31, 2018, including net revenue of $181.7 and net income available to IPG common stockholders of $20.4, are included in our Consolidated Statements of Operations for the year ended December 31, 2018. The Company incurred a total of $35.0 in "Selling, general and administrative expenses," $3.7 in "Interest expense," $0.4 in "Interest income" and $10.3 in "Other expense, net," for transaction-related costs in connection with the acquisition. The following table presents the combined results of the Company and Acxiom for the year ended December 31, 2018 on an unaudited pro forma basis, as if the acquisition had occurred on January 1, 2017. The unaudited pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if that acquisition had taken place at the beginning of January 1, 2017. It also does not reflect changes in cost structure or operations resulting from restructuring activities, changes in the business, or future events that may occur after the completion of the acquisition. The pro forma combined results of operations shown below include the business combination accounting effects resulting from the acquisition.
| (Unaudited)
| December 31,
2018
Pro forma revenues | $ | 10,230.4 |
Pro forma net income | 642.2 |
Other Acquisitions We continue to evaluate strategic opportunities to expand our industry expertise, strengthen our position in high-growth and key strategic geographical markets and industry sectors, advance technological capabilities and improve operational efficiency through both acquisitions and increased ownership interests in current investments. Our acquisitions typically provide for an initial payment at the time of closing and additional contingent purchase price payments based on the future performance of the acquired entity. We have entered into agreements that may require us to purchase additional equity interests in certain consolidated and unconsolidated subsidiaries. The amounts at which we record these transactions in our financial statements are based on estimates of the future financial performance of the acquired entity, the timing of the exercise of these rights, changes in foreign currency exchange rates and other factors. During 2020 we completed four acquisitions, three of which were included in the IAN reportable segment, and one of which were included in the DXTRA reportable segment. These acquisitions include traditional advertising agency based in Colombia, a marketing and communications agency based in the U.K., a boutique post-production company based in New York, and a mobile app design agency based in the U.K. During 2020, we recorded approximately $28.0 of goodwill and other intangible assets related to our acquisitions. During 2019, we completed one acquisition, a content communications agency based in the U.K. This acquisition was included in the IAN reportable segment. During 2019, we recorded approximately $7.6 of goodwill and other intangible assets related to our acquisitions. During 2018, we completed five acquisitions, two of which were included in the IAN reportable segment, and three of which were included in the DXTRA reportable segment. These acquisitions include a data and technology company based in the U.S., as discussed in detail above, a full-service digital agency based in Brazil, an entertainment marketing and brand licensing agency in the fashion and lifestyle sector based in the U.K., a content-focused social creative agency based in the U.K. and a content production firm based in Israel. During 2018, we recorded approximately $2,131.0 of goodwill and other intangible assets related to our acquisitions. The results of operations of our acquired companies were included in our consolidated results from the closing date of each acquisition. We did not make any payments in stock related to our acquisitions in 2020, 2019 or 2018. Details of cash paid for current and prior years' acquisitions are listed below.
| Years ended December 31,
| 2020 |  | 2019 |  | 2018
Cost of investment: current-year acquisitions 1 | $ | 8.5 |  |  | $ | 0.6 |  |  | $ | 2,323.4 |
Cost of investment: prior-year acquisitions | 45.9 |  |  | 15.8 |  |  | 33.9 |
Less: net cash acquired | (2.9) |  |  | — |  |  | (13.8) |
Total cost of investment | 51.5 |  |  | 16.4 |  |  | 2,343.5 |
Operating payments 2 | 2.9 |  |  | 9.3 |  |  | 19.4 |
Total cash paid for acquisitions 3 | $ | 54.4 |  |  | $ | 25.7 |  |  | $ | 2,362.9 |
1 The cost of investment: current-year acquisitions line significantly increased in the year ended December 31, 2018, primarily as a result of payments related to the acquisition of Acxiom. 2 Represents cash payments for amounts that have been recognized in operating expenses since the date of acquisition either relating to adjustments to estimates in excess of the initial value of contingent payments recorded or were contingent upon the future employment of the former owners of the acquired companies. Amounts are reflected in the operating section of the Consolidated Statements of Cash Flows. 3 Of the total cash paid for acquisitions, $4.9, $0.6 and $2,309.8 for the years ended December 31, 2020, 2019 and 2018, respectively, are classified under the investing section of the Consolidated Statements of Cash Flows as acquisitions, net of cash acquired. These amounts relate to initial payments for new transactions. Of the total cash paid for acquisitions, $46.6, $15.8 and $33.7 for the years ended December 31, 2020, 2019 and 2018, respectively, are classified under the financing section of the Consolidated Statements of Cash Flows as acquisition-related payments. These amounts relate to deferred payments and increases in our ownership interest for prior acquisitions. For companies acquired, we estimate the fair values of the assets and liabilities based on 100% of the business for consolidation. The purchase price in excess of the estimated fair value of the tangible net assets acquired is allocated to identifiable intangible assets and then to goodwill. Due to the characteristics of advertising, specialized marketing and communication services companies, our acquisitions typically do not have significant amounts of tangible assets since the principal assets we acquire are client relationships and talent. As a result, a substantial portion of the purchase price is primarily allocated to customer lists, trade names and goodwill. For acquisitions we record deferred payment and redeemable noncontrolling interest amounts on our Consolidated Balance Sheets based on their acquisition-date fair value. Deferred payments are recorded on a discounted basis and adjusted quarterly, if necessary, through operating income or net interest expense, depending on the nature of the arrangement, for both changes in estimate and accretion between the acquisition date and the final payment date. See Note 16 for further information on contingent acquisition obligations. Redeemable noncontrolling interests are adjusted quarterly, if necessary, to their estimated redemption value, but not less than their initial fair value. Any adjustments to the redemption value impact retained earnings or additional paid in capital, except for foreign currency translation adjustments. The following table presents changes in our redeemable noncontrolling interests.
| Years ended December 31,
| 2020 |  | 2019 |  | 2018
Balance at beginning of period | $ | 164.7 |  |  | $ | 167.9 |  |  | $ | 252.1 |
Change in related noncontrolling interests balance | (5.4) |  |  | (2.8) |  |  | (10.7) |
Changes in redemption value of redeemable noncontrolling interests: |  |  |  |  |
Additions | 0.0 |  |  | 24.3 |  |  | 0.0 |
Redemptions and other | (20.6) |  |  | (24.9) |  |  | (33.7) |
Redemption value adjustments 1 | (45.6) |  |  | 0.2 |  |  | (39.8) |
Balance at end of period | $ | 93.1 |  |  | $ | 164.7 |  |  | $ | 167.9 |
1 Redemption value adjustments for the year ended December 31, 2020 were primarily attributable to the expiration of redemption provisions related to redeemable noncontrolling interests. For all acquisitions, if a portion of the deferred payments and purchases of additional interests after the effective date of purchase are contingent upon employment terms, then that amount is accounted for separately from the business combination and recognized as compensation expense over the required earn-out period. Payments deemed as compensation are excluded from the fair value purchase price allocation to tangible net assets and intangible assets acquired.

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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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