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Acquisitions and Other Investments | 6 Months Ended
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Jun. 30, 2024
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] |
Acquisitions and Other Investments |
4. | Acquisitions and Other Investments
Business Combinations 2023 Payzer Acquisition On November 1, 2023, the Company closed on the acquisition of Payzer Holdings, Inc. (“Payzer”), a cloud-based, field service management software provider (the “Payzer Acquisition”). The acquisition is expected to advance WEX’s growth strategy of expanding its product suite and creating additional cross-sell opportunities by providing a new, scalable SaaS solution for its Mobility segment customers that operate field service management companies. Pursuant to the terms of the agreement, total consideration for the acquisition approximated $250.0 million ($5.5 million of which is deferred), with additional contingent consideration of up to $11.0 million based on certain performance metrics, subject to certain working capital and other adjustments. The table below summarizes the preliminary allocation of fair value to the assets acquired and liabilities assumed on the date of acquisition under the acquisition method of accounting. These fair values may continue to be revised during the measurement period as third-party valuations on the intangible assets are finalized, further information becomes available and additional analyses are performed, and those adjustments could have a material impact on the purchase price allocation.
(in millions) |  | As Reported December 31, 2023 |  | Measurement Period Adjustments |  | As Reported June 30, 2024
Cash consideration transferred, net o f $4.5 million in cash acquired |  | $ | 244.0 |  |  | $ | — |  |  | $ | 244.0 |
Less: |  |  |  |  |  |
Accounts receivable |  | 2.4 |  |  | — |  |  | 2.4 |
Customer relationships(1)(5) |  | 40.4 |  |  | — |  |  | 40.4 |
Developed technology(2)(5) |  | 17.2 |  |  | — |  |  | 17.2 |
Strategic partner relationships(3)(5) |  | 4.5 |  |  | — |  |  | 4.5 |
Trademark(4)(5) |  | 1.4 |  |  | — |  |  | 1.4 |
Other current and long-term assets |  | 1.4 |  |  | — |  |  | 1.4 |
Accrued expenses and other current liabilities |  | (1.8) |  |  | — |  |  | (1.8) |
Deferred tax liability |  | (6.5) |  |  | 3.0 |  |  | (3.5) |
Contingent/deferred consideration |  | (7.1) |  |  | — |  |  | (7.1) |
Other liabilities |  | (0.9) |  |  | — |  |  | (0.9) |
Recorded goodwill |  | $ | 193.0 |  |  | $ | (3.0) |  |  | $ | 190.0 |
(1)Weighted average useful life - 4.7 years (2)Weighted average useful life - 2.4 years (3)Weighted average useful life - 2.5 years (4)Weighted average useful life - 2.8 years (5)The weighted average useful life of all amortizable intangible assets acquired in this business combination is 3.9 years Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents the anticipated synergies of acquiring the business. The goodwill recognized as a result of the Payzer Acquisition is not expected to be deductible for tax purposes. No pro forma information has been included in these financial statements, as the operations of Payzer for the period that it was not part of the Company is not material to the Company’s revenues, net income or earnings per share. 2023 Ascensus Acquisition On September 1, 2023, WEX Health completed the acquisition from Ascensus, LLC (the “Ascensus Acquisition”) of certain entities (the “Ascensus Acquired Entities”), which comprised the health and benefits business of Ascensus and are technology-enabled providers of employee health benefit accounts including HSAs, FSAs, and other benefit accounts. The Ascensus Acquisition expands WEX’s footprint in the Benefits segment, while also enhancing and expanding Affordable Care Act compliance and verification capabilities. Pursuant to the terms of the agreement, WEX Health consummated the acquisition for total consideration of approximately $185.5 million, after a $0.9 million working capital adjustment paid by the Company during the first quarter of 2024. The table below summarizes the preliminary allocation of fair value to the assets acquired and liabilities assumed on the date of acquisition under the acquisition method of accounting. These fair values may continue to be revised during the measurement period as third-party valuations on the intangible assets are finalized, further information becomes available and additional analyses are performed, and those adjustments could have a material impact on the purchase price allocation.
(in millions) |  | As Reported December 31, 2023 |  | Measurement Period Adjustments |  | As Reported June 30, 2024
Cash consideration transferred, net of $26.7 million in cash and restricted cash acquired |  | $ | 158.0 |  |  | $ | 0.9 |  |  | $ | 158.9 |
Less: |  |  |  |  |  |
Accounts receivable |  | 7.3 |  |  | — |  |  | 7.3 |
Customer relationships(1)(5) |  | 52.1 |  |  | — |  |  | 52.1 |
Developed technology(2)(5) |  | 6.6 |  |  | — |  |  | 6.6 |
Strategic partner relationships(3)(5) |  | 14.0 |  |  | — |  |  | 14.0 |
Custodial rights(4)(5) |  | 23.2 |  |  | — |  |  | 23.2 |
Other assets |  | 3.8 |  |  | — |  |  | 3.8 |
Accrued expenses and other current liabilities |  | (6.5) |  |  | — |  |  | (6.5) |
Restricted cash payable |  | (25.7) |  |  | — |  |  | (25.7) |
Other liabilities |  | (2.7) |  |  | — |  |  | (2.7) |
Recorded goodwill |  | $ | 85.9 |  |  | $ | 0.9 |  |  | $ | 86.8 |
(1)Weighted average life - 5.4 years (2)Weighted average life - 2.2 years (3)Weighted average life - 1.2 years (4)Weighted average life - 4.9 years (5)The weighted average useful life of all amortizable intangible assets acquired in this business combination is 4.4 years. Goodwill is calculated as the excess of the consideration transferred over the net assets recognized and represents the anticipated synergies of acquiring the business. The goodwill recognized as a result of the acquisition is expected to be deductible for tax purposes. No pro forma information has been included in these financial statements, as the operations of the Ascensus Acquired Entities for the period that they were not part of the Company are not material to the Company’s revenues, net income or earnings per share.

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