XML 25 R12.htm IDEA: XBRL DOCUMENT
v3.22.0.1

Acquisitions | 12 Months Ended
--- | ---
Dec. 31, 2021
Business Combination and Asset Acquisition [Abstract] |
Acquisitions | Acquisitions Other acquisitions On April 23, 2021, we completed a small acquisition for total consideration of $27 which included $20 in cash, a $3 deferred cash payment and $4 in restricted stock units. We recognized goodwill of $23 and other assets of $5. Stitcher On October 16, 2020, Sirius XM acquired certain assets and liabilities of Stitcher from Scripps for $266 in cash, which amount included net working capital adjustments of $5 during the year ended December 31, 2021. The total purchase consideration of $302 included $36 related to the acquisition date fair value of the contingent consideration. During the year ended December 31, 2021, Stitcher did not achieve certain financial metrics, as a result of which we do not expect to pay to Scripps the 2021 portion of the contingent consideration associated with the transaction. During the year ended December 31, 2021, we recognized a $17 benefit related to the change in fair value of the 2021 portion of the contingent consideration in Impairment, restructuring and acquisition costs on our consolidated statements of comprehensive income. The fair value of the contingent consideration was determined using a probability-weighted cash flow model and will be remeasured to fair value at each subsequent reporting period. Stitcher is included in our Pandora reporting unit. The table below summarizes the fair value of the assets acquired and liabilities assumed as of the acquisition date:
Acquired Assets: |
Receivables, net | $ | 21 |
Prepaid expenses and other current assets | 16 |
Property and equipment | 8 |
Intangible assets | 38 |
Goodwill | 224 |
Operating lease right-of-use assets | 11 |
Total assets | $ | 318 |
Assumed Liabilities: |
Accounts payable and accrued expenses | $ | 4 |
Deferred revenue | 1 |
Operating lease current liabilities | 2 |
Operating lease liabilities | 9 |
Total liabilities | $ | 16 |
Total consideration | $ | 302 |
The Stitcher acquisition was accounted for using the acquisition method of accounting and was financed through borrowings under Sirius XM's Credit Facility. Simplecast On June 16, 2020, Sirius XM acquired Simplecast for $28 in cash. Simplecast is a podcast management and analytics platform. Simplecast complements AdsWizz's advertising technology platform, allowing the company to offer podcasters of all sizes a powerful, comprehensive solution for publishing, analytics, distribution and advertising sales, and is included in the Pandora reporting unit. The Simplecast acquisition was accounted for using the acquisition method of accounting. We recognized goodwill of $17, amortizable intangible assets of $12, other assets of less than $1 and deferred tax liabilities of $1. Pandora On February 1, 2019, through a series of transactions, Pandora Media, Inc., became an indirect wholly owned subsidiary of Sirius XM and continues to operate as Pandora Media, LLC (the “Pandora Acquisition”). In connection with the Pandora Acquisition, we purchased all of the outstanding shares of the capital stock of Pandora for $2,355 by converting each outstanding share of Pandora common stock into 1.44 shares of our common stock and we also canceled our preferred stock investment in Pandora for $524 for total consideration of $2,879. Net cash acquired was $313. As part of the Pandora Acquisition, Holdings unconditionally guaranteed all of the payment obligations of Pandora under its outstanding 1.75% convertible senior notes due 2020 and 1.75% convertible senior notes due 2023. The table below shows the value of the consideration paid in connection with the Pandora Acquisition:
| Total
Pandora common stock outstanding | 272 |
Exchange ratio | 1.44 |
Common stock issued | 392 |
Price per share of Holdings common stock | $ | 5.83 |
Value of common stock issued to Pandora stockholders | $ | 2,285 |
Value of replacement equity awards attributable to pre-combination service | $ | 70 |
Consideration of common stock and replacement equity awards for pre-combination service | $ | 2,355 |
Sirius XM’s Pandora preferred stock investment (related party fair value instrument) canceled | $ | 524 |
Total consideration for Pandora Acquisition | $ | 2,879 |
Value attributed to par at $0.001 par value | $ | 1 |
Balance to capital in excess of par value | $ | 2,354 |
The table below summarizes the fair value of the assets acquired and liabilities assumed as of the acquisition date:
Acquired Assets: |
Cash and cash equivalents | $ | 313 |
Receivables, net | 353 |
Prepaid expenses and other current assets | 109 |
Property and equipment | 65 |
Intangible assets | 1,107 |
Goodwill | 1,553 |
Deferred tax assets | 102 |
Operating lease right-of-use assets | 104 |
Long term assets | 7 |
Total assets | $ | 3,713 |
Assumed Liabilities: |
Accounts payable and accrued expenses | $ | 324 |
Deferred revenue | 37 |
Operating lease current liabilities | 28 |
Current maturities of debt | 151 |
Long-term debt (a) | 218 |
Operating lease liabilities | 69 |
Other long-term liabilities | 7 |
Total liabilities | $ | 834 |
Total consideration | $ | 2,879 |
(a)In order to present the assets acquired and liabilities assumed, the conversion feature associated with Pandora's convertible notes for $62 has been included within Long-term debt in the table above and included within Additional paid-in-capital within our statement of stockholders' equity (deficit). Refer to Note 13 for additional information. The Pandora Acquisition was accounted for using the acquisition method of accounting. The excess purchase price over identifiable net tangible and intangible assets of $1,553 was recorded to Goodwill in our consolidated balance sheets as of December 31, 2019. Refer to Note 8 for a further discussion of Pandora goodwill which was impaired in the year ended December 31, 2020. A total of $776 has been allocated to identifiable intangible assets subject to amortization and relates to the assessed fair value of the acquired customer relationships and software and technology and is being amortized over the estimated weighted average useful lives of 8 and 5 years, respectively. A total of $331 has been allocated to identifiable indefinite lived intangible assets and relates to the assessed fair value of the acquired trademarks. The fair value assessed for the majority of the remaining assets acquired and liabilities assumed equaled their carrying value. Goodwill represents synergies and economies of scale expected from the combination of services. Goodwill has been allocated to the Pandora segment. Additionally, in connection with the Pandora Acquisition, we acquired gross net operating loss (“NOL”) carryforwards of approximately $1,287 for federal income tax purposes that are available to offset future taxable income. The acquired NOL's are limited by Section 382 of the Internal Revenue Code. Those limitations are not expected to impact our ability to fully utilize those NOL's within the carryforward period. We recognized acquisition related costs of $84 related to the Pandora Acquisition during the year ended December 31, 2019. Pro Forma Financial Information Pandora was consolidated into our financial statements starting on the acquisition date, February 1, 2019. The aggregate revenue and net loss of Pandora consolidated into our financial statements was $1,607 and $303, respectively, for the year ended December 31, 2019. The following pro forma financial information presents our results as if the Pandora Acquisition had occurred on January 1, 2019:
|  |  | For the Years Ended December 31,
|  |  |  |  | 2021 |  | 2020 |  | 2019
Total revenue |  |  |  |  | $ | 8,696 |  |  | $ | 8,046 |  |  | $ | 7,921 |
Net income |  |  |  |  | $ | 1,314 |  |  | $ | 131 |  |  | $ | 938 |
These pro forma results are based on estimates and assumptions, which we believe are reasonable. They are not the results that would have been realized had the acquisition actually occurred on January 1, 2019 and are not indicative of our consolidated results of operations in future periods. The pro forma results primarily include adjustments related to amortization of acquired intangible assets, depreciation of property and equipment, acquisition costs, fair value gain or loss on the Pandora investment and associated tax impacts.

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationAndAssetAcquisitionAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration