XML 22 R10.htm IDEA: XBRL DOCUMENT
v3.8.0.1

Acquisitions and Divestitures | 9 Months Ended
--- | ---
Sep. 30, 2017
Business Combinations [Abstract] |
Acquisitions and Divestitures | ACQUISITIONS AND DIVESTITURES Aliante Casino + Hotel + Spa On September 27, 2016, Boyd Gaming completed the acquisition of ALST Casino Holdco LLC, the holding company of Aliante Casino + Hotel + Spa ("Aliante"). Pursuant to the merger agreement, Merger Sub merged (the "Merger") with and into ALST, with ALST surviving the Merger. ALST and Aliante are now wholly owned subsidiaries of Boyd Gaming. Accordingly, the acquired assets and liabilities of Aliante are included in our condensed consolidated balance sheets as of September 30, 2017 and December 31, 2016 and the results of its operations in our condensed consolidated statements of operations for the three and nine months ended September 30, 2017. Aliante's cash flows are reported in our condensed consolidated statements of cash flows for the nine months ended September 30, 2017. Aliante is an upscale, resort-style casino and hotel situated in North Las Vegas and offering premium accommodations, gaming, dining, entertainment and retail, and is aggregated into our Las Vegas Locals segment (See Note 11, Segment Information). Acquisition Method of Accounting The Company followed the acquisition method of accounting according to the guidance of FASB Accounting Standards Codification Topic 805 ("ASC 805"). In accordance with ASC 805, the Company allocated the purchase price to the tangible and intangible assets acquired and liabilities assumed based on their fair values, which were determined primarily by management with assistance from third-party appraisals. The excess of the purchase price over those fair values was recorded as goodwill. The purchase price allocation below represents Aliante’s opening balance sheet on September 27, 2016, which was initially reported in our Form 10−K for the year ended December 31, 2016. During the measurement period, which concluded on June 30, 2017, opening balance sheet adjustments were made to finalize the preliminary fair value estimates, resulting in a $2.6 million reduction in other assets, primarily related to base stock, a $0.8 million reduction in property and equipment and a $0.4 million increase in assumed liabilities, with a corresponding net increase to goodwill of $3.8 million. The measurement period adjustment and the related tax impact were immaterial to our condensed consolidated financial statements. The following table presents the components and allocation of the purchase price, including the measurement period adjustments:
(In thousands) |  | Preliminary Purchase Price Allocation |  | Adjustments |  | Final Purchase Price Allocation
Current assets |  | $ | 31,886 |  |  | $ | — |  |  | $ | 31,886 |
Property and equipment |  | 226,309 |  |  | (760 | ) |  | 225,549 |
Intangible and other assets |  | 20,791 |  |  | (2,643 | ) |  | 18,148 |
Total acquired assets |  | 278,986 |  |  | (3,403 | ) |  | 275,583 |
Current liabilities |  | 5,693 |  |  | 515 |  |  | 6,208 |
Other liabilities |  | 636 |  |  | (83 | ) |  | 553 |
Total liabilities assumed |  | 6,329 |  |  | 432 |  |  | 6,761 |
Net identifiable assets acquired |  | 272,657 |  |  | (3,835 | ) |  | 268,822 |
Goodwill |  | 126,489 |  |  | 3,835 |  |  | 130,324 |
Net assets acquired |  | $ | 399,146 |  |  | $ | — |  |  | $ | 399,146 |
Cannery Casino Hotel and Nevada Palace, LLC On December 20, 2016 (the "Acquisition Date"), Boyd Gaming completed the acquisitions of Cannery, the owner and operator of Cannery Casino Hotel, and Eastside Cannery, the owner and operator of Eastside Cannery Casino and Hotel, pursuant to a Membership Interest Purchase Agreement (the "Purchase Agreement") dated as of April 25, 2016, as amended on October 28, 2016, by and among Boyd, Cannery Casino Resorts, LLC ("Seller"), Cannery and Eastside Cannery. Pursuant to the terms of the Purchase Agreement, Boyd acquired from Seller all of the issued and outstanding membership interests of Cannery and Eastside Cannery (the "Acquisitions"). With the closing of the Acquisitions, each of Cannery and Eastside Cannery became wholly owned subsidiaries of Boyd. Accordingly, the acquired assets and liabilities of Cannery and Eastside Cannery are included in our condensed consolidated balance sheets as of September 30, 2017 and December 31, 2016 and the results of their operations in our condensed consolidated statements of operations for the three and nine months ended September 30, 2017. The Cannery and Eastside Cannery's cash flows are reported in our condensed consolidated statements of cash flows for the nine months ended September 30, 2017. The Cannery and Eastside Cannery are modern casinos and hotels in the Las Vegas Valley that offer premium accommodations, gaming, dining, entertainment and retail, and are aggregated into our Las Vegas Locals segment (See Note 11, Segment Information). The fair value of the consideration transferred to Seller on the Acquisition Date was $238.6 million. In addition, the Purchase Agreement provided for a working capital adjustment to the purchase consideration. This adjustment was calculated during second quarter 2017 and paid during the third quarter, resulting in an additional $1.2 million being paid to Seller. Acquisition Method of Accounting The Company followed the acquisition method of accounting per ASC 805 guidance. For purposes of these financial statements, we have allocated the purchase price to the assets acquired and the liabilities assumed based on their fair values, as determined by management based on its judgment with assistance from third-party appraisals. The excess of the purchase price over the net book value of the assets acquired and liabilities assumed has been recorded as goodwill. The purchase price allocation below represents the opening balance sheet on December 20, 2016, which was initially reported in our Form 10-K for the year ended December 31, 2016. During the measurement period, which concluded on September 30, 2017, opening balance sheet adjustments were made to finalize the preliminary fair value estimates, resulting in a $62.5 million reduction in acquired assets, primarily related to a $56.7 million reduction in property and equipment, and a $5.0 million reduction in assumed liabilities with a corresponding increase to goodwill of $58.7 million. The property and equipment adjustment resulted in a depreciation expense reduction of $1.9 million for the nine months ended September 30, 2017. The measurement period adjustment and the related tax impact were immaterial to our condensed consolidated financial statements. The following table summarizes the components and allocation of the purchase price, including the measurement period adjustments:
(In thousands) |  | Preliminary Purchase Price Allocation |  | Adjustments |  | Final Purchase Price Allocation
Current assets |  | $ | 29,929 |  |  | $ | (8,345 | ) |  | $ | 21,584 |
Property and equipment |  | 181,757 |  |  | (56,675 | ) |  | 125,082 |
Other long-term assets |  | — |  |  | 3,419 |  |  | 3,419 |
Intangible and other assets |  | 16,330 |  |  | (880 | ) |  | 15,450 |
Total acquired assets |  | 228,016 |  |  | (62,481 | ) |  | 165,535 |
Current liabilities |  | 15,850 |  |  | (4,984 | ) |  | 10,866 |
Total liabilities assumed |  | 15,850 |  |  | (4,984 | ) |  | 10,866 |
Net identifiable assets acquired |  | 212,166 |  |  | (57,497 | ) |  | 154,669 |
Goodwill |  | 26,401 |  |  | 58,651 |  |  | 85,052 |
Net assets acquired |  | $ | 238,567 |  |  | $ | 1,154 |  |  | $ | 239,721 |
Investment in and Divestiture of Borgata On August 1, 2016, Boyd Gaming completed the sale of its 50% equity interest in MDDHC, the parent company of Borgata in Atlantic City, New Jersey, to MGM pursuant to the Purchase Agreement entered into on May 31, 2016, as amended on July 19, 2016, by and among Boyd, Boyd Atlantic City, Inc., a wholly owned subsidiary of Boyd, and MGM. Prior to the sale of our equity interest, the Company and MGM each held a 50% interest in MDDHC, which owns all the equity interests in Borgata. Until the closing of the sale, we were the managing member of MDDHC, and we were responsible for the day-to-day operations of Borgata. Pursuant to the Purchase Agreement, MGM acquired from Boyd Gaming 49% of its 50% membership interest in MDDHC and, immediately thereafter, MDDHC redeemed Boyd Gaming’s remaining 1% membership interest in MDDHC (collectively, the "Transaction"). Following the Transaction, MDDHC became a wholly-owned subsidiary of MGM. In consideration for the Transaction, MGM paid Boyd Gaming $900 million. The initial net cash proceeds were approximately $589 million, net of certain expenses and adjustments on the closing date, including outstanding indebtedness, cash and working capital. These initial proceeds did not include our 50% share of any future property tax settlement benefits related to the time period during which we held a 50% ownership in MDDHC to which Boyd Gaming retained the right to receive upon payment. On February 15, 2017, Borgata entered into a settlement agreement with Atlantic City, the terms of which provided for $72 million to be paid to Borgata to resolve the remaining property tax issues. Borgata received full payment, and we received our share of the proceeds, in June 2017. For the nine months ended September 30, 2017, we recognized $36.2 million in income for the cash we received for our share of property tax benefits realized by Borgata after the closing of the sale. These payments, net of tax of $14.8 million for the nine months ended September 30, 2017, are included in discontinued operations in the condensed consolidated financial statements. Summarized income statement information for Borgata is as follows:
(In thousands) | Period from July 1 to July 31, 2016 |  | Period from January 1 to July 31, 2016
Net revenues | $ | 91,870 |  |  | $ | 485,510 |
Operating expenses | 63,997 |  |  | 366,812 |
Operating income | 27,873 |  |  | 118,698 |
Non-operating expenses | 6,104 |  |  | 36,280 |
Net income | $ | 21,769 |  |  | $ | 82,418 |

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

X
- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References No definition available. + Details
Name: | us-gaap_MergersAcquisitionsAndDispositionsDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration