XML 74 R12.htm IDEA: XBRL DOCUMENT
v3.19.3.a.u2

Goodwill and Other Intangible Assets | 12 Months Ended
--- | ---
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets White Mountains accounts for business combinations using the acquisition method. Under the acquisition method, White Mountains recognizes and measures the assets acquired, liabilities assumed and any non-controlling interest in the acquired entities at their acquisition date fair values. The estimated acquisition date fair values, generally consisting of intangible assets and liabilities for contingent consideration, may be recorded at provisional amounts in circumstances where the information necessary to complete the acquisition accounting is not available at the reporting date. Any such provisional amounts are finalized as measurement period adjustments within one year of the acquisition date. The following table presents the economic lives, acquisition date fair values, accumulated amortization and net carrying values for other intangible assets and goodwill, by company as of December 31, 2019 and 2018:
$ in Millions |  | Weighted Average Economic Life (in years) |  | December 31, 2019 |  | December 31, 2018
| Acquisition Date Fair Value |  | Accumulated Amortization |  | Impairments |  | Net Carrying Value |  | Acquisition Date Fair Value |  | Accumulated Amortization |  | Net Carrying Value
Goodwill: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
NSM (1)(2) |  | N/A |  | $ | 381.6 |  |  | $ | — |  |  | $ | — |  |  | $ | 381.6 |  |  | $ | 354.3 |  |  | $ | — |  |  | $ | 354.3 |
Kudu |  | N/A |  | 7.6 |  |  | — |  |  | — |  |  | 7.6 |  |  | — |  |  | — |  |  | — |
MediaAlpha |  | N/A |  | — |  |  | — |  |  | — |  |  | — |  |  | 18.3 |  |  | — |  |  | 18.3 |
Other Operations (3) |  | N/A |  | 13.1 |  |  | — |  |  | 7.6 |  |  | 5.5 |  |  | 7.3 |  |  | — |  |  | 7.3 |
Total goodwill |  |  |  | 402.3 |  |  | — |  |  | 7.6 |  |  | 394.7 |  |  | 379.9 |  |  | — |  |  | 379.9 |
Other intangible assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
NSM (1)(2) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Customer relationships |  | 9 |  | 121.7 |  |  | 19.8 |  |  | 1.4 |  |  | 100.5 |  |  | 85.3 |  |  | 6.0 |  |  | 79.3 |
Trade names |  | 19 |  | 61.9 |  |  | 5.3 |  |  | .4 |  |  | 56.2 |  |  | 51.2 |  |  | 1.8 |  |  | 49.4 |
Information technology platform |  | 5 |  | 3.9 |  |  | 1.4 |  |  | .6 |  |  | 1.9 |  |  | 3.7 |  |  | .5 |  |  | 3.2 |
Renewal rights |  | 12 |  | 82.5 |  |  | .7 |  |  | — |  |  | 81.8 |  |  | — |  |  | — |  |  | — |
Other |  | 3 |  | 1.7 |  |  | .7 |  |  | — |  |  | 1.0 |  |  | — |  |  | — |  |  | — |
Subtotal |  |  |  | 271.7 |  |  | 27.9 |  |  | 2.4 |  |  | 241.4 |  |  | 140.2 |  |  | 8.3 |  |  | 131.9 |
Kudu |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Trade names |  | 7 |  | 2.2 |  |  | .2 |  |  | — |  |  | 2.0 |  |  | — |  |  | — |  |  | — |
MediaAlpha |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Customer relationships |  | 9 |  | — |  |  | — |  |  | — |  |  | — |  |  | 26.8 |  |  | 4.9 |  |  | 21.9 |
Information technology platform |  | 5 |  | — |  |  | — |  |  | — |  |  | — |  |  | 33.3 |  |  | 30.9 |  |  | 2.4 |
Other |  | 3 |  | — |  |  | — |  |  | — |  |  | — |  |  | 9.8 |  |  | 9.0 |  |  | .8 |
Subtotal |  |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 69.9 |  |  | 44.8 |  |  | 25.1 |
Other Operations |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Trade names |  | 10 |  | 1.7 |  |  | .5 |  |  | .2 |  |  | 1.0 |  |  | .6 |  |  | .2 |  |  | .4 |
Customer Relationships |  | 11 |  | 7.2 |  |  | .4 |  |  | — |  |  | 6.8 |  |  | — |  |  | — |  |  | — |
Information technology platform |  | 5 |  | .5 |  |  | .3 |  |  | .2 |  |  | — |  |  | .5 |  |  | .3 |  |  | .2 |
Insurance licenses |  | N/A |  | 8.6 |  |  | — |  |  | — |  |  | 8.6 |  |  | — |  |  | — |  |  | — |
Other |  | 5 |  | .2 |  |  | — |  |  | — |  |  | .2 |  |  | — |  |  | — |  |  | — |
Subtotal |  |  |  | 18.2 |  |  | 1.2 |  |  | .4 |  |  | 16.6 |  |  | 1.1 |  |  | .5 |  |  | .6 |
Total other intangible assets |  | 292.1 |  |  | 29.3 |  |  | 2.8 |  |  | 260.0 |  |  | 211.2 |  |  | 53.6 |  |  | 157.6 |
Total goodwill and other intangible assets | $ | 694.4 |  |  | $ | 29.3 |  |  | $ | 10.4 |  |  | 654.7 |  |  | $ | 591.1 |  |  | $ | 53.6 |  |  | 537.5 |
Goodwill and other intangible assets attributed to non-controlling interests | (23.4 | ) |  |  |  |  |  | (40.6 | )
Goodwill and other intangible assets included in White Mountains’s common shareholders’ equity |  | $ | 631.3 |  |  |  |  |  |  | $ | 496.9 |
(1) As of December 31, 2019, NSM’s goodwill and intangible assets includes $1.4 and $0.7 of the effect of foreign currency translation. As of December 31, 2018, NSM’s goodwill and intangible assets includes $(2.2) and $(0.7) of the effect of foreign currency translation. (2) The relative fair values of goodwill and other intangible assets recognized in connection with the acquisition of KBK had not yet been determined at December 31, 2018. The attribution of acquisition date fair value estimates between goodwill and other intangible assets for KBK was completed during 2019. (3) As of December 31, 2019 and 2018, Other Operations’ goodwill includes $0.0 and $(0.3) of the effect of foreign currency translation. The goodwill recognized for the entities shown above is attributed to expected future cash flows. The acquisition date fair values of other intangible assets with finite lives are estimated using income approach techniques, which use future expected cash flows to develop a discounted present value amount. The multi-period-excess-earnings method estimates fair value using the present value of the incremental after-tax cash flows attributable solely to the other intangible asset over its remaining life. This approach was used to estimate the fair value of other intangible assets associated with trade names, customer relationships and contracts and information technology. The relief-from-royalty method was used to estimate fair value for other intangible assets that relate to rights that could be obtained via a license from a third-party owner. Under this method, the fair value is estimated using the present value of license fees avoided by owning rather than leasing the asset. This technique was used to estimate the fair value of domain names, certain trademarks and brand names. The with-or-without method estimates the fair value of an other intangible asset that provides an incremental benefit. Under this method, the fair value of the other intangible asset is calculated by comparing the value of the entity with and without the other intangible asset. This approach was used to estimate the fair value of favorable lease terms. The following table presents a summary of the acquisition date fair values of goodwill and other intangible assets for acquisitions completed during 2019 and 2018:
$ in Millions |  |  |  |
Acquisition of Subsidiary/ Asset |  | Goodwill and Other Intangible Assets(1) |  | Acquisition Date
NSM |  | $ | 383.0 |  |  | May 11, 2018
Fresh Insurance |  | 54.6 |  |  | May 18, 2018
KBK(3) |  | 65.3 |  |  | December 3, 2018
Embrace(2) |  | 67.6 |  |  | April 1, 2019
Renewal Rights (3) |  | 82.5 |  |  | June 28, 2019
Total NSM segment |  | $ | 653.0 |  |  |
Kudu Transaction |  | $ | 9.8 |  |  | April 4, 2019
Other Operations |  | $ | 22.6 |  |  | Various
(1) Acquisition date fair values include the effect of adjustments during the measurement period and excludes the effect of foreign currency translation subsequent to the acquisition date. (2) Excludes $3.4 of software classified within other assets. (3) NSM’s purchase of the Renewal Rights from AIG was an asset acquisition. NSM’s purchase of KBK was accounted for as a business combination but did not include acquisition of the legal entity. On an annual basis beginning no later than the interim period included in the one-year anniversary of an acquisition, White Mountains evaluates goodwill for potential impairment. During 2019, White Mountains recognized impairments of goodwill of $7.6 million and other intangible assets of $2.8 million, of which $7.6 million of goodwill and $0.4 million of other intangible assets related to Other Operations and $2.4 million of other intangible assets related to Fresh Insurance. There were no impairments during 2018 or 2017. The following table presents the change in goodwill and other intangible assets:
|  | December 31,
|  | 2019 |  | 2018
Millions |  | Goodwill |  | Other Intangible Assets |  | Total Goodwill and Other Intangible Assets |  | Goodwill |  | Other Intangible Assets |  | Total Goodwill and Other Intangible Assets
Beginning balance |  | $ | 379.9 |  |  | $ | 157.6 |  |  | $ | 537.5 |  |  | $ | 25.9 |  |  | $ | 36.2 |  |  | $ | 62.1 |
Acquisitions of businesses (1) |  | 64.8 |  |  | 34.6 |  |  | 99.4 |  |  | 356.5 |  |  | 140.9 |  |  | 497.4 |
Acquisition of collector car renewal rights |  | — |  |  | 82.5 |  |  | 82.5 |  |  | — |  |  | — |  |  | — |
Dispositions of businesses (2) |  | (18.3 | ) |  | (23.5 | ) |  | (41.8 | ) |  | — |  |  | — |  |  | — |
Attribution of acquisition date fair value estimates between goodwill and other intangible assets (3) |  | (26.8 | ) |  | 26.8 |  |  | — |  |  | — |  |  | — |  |  | — |
Impairments (4) |  | (7.6 | ) |  | (2.8 | ) |  | (10.4 | ) |  | — |  |  | — |  |  | — |
Measurement period adjustments(5) |  | .9 |  |  | 5.9 |  |  | 6.8 |  |  | — |  |  | — |  |  | — |
Foreign currency translation |  | 1.8 |  |  | .7 |  |  | 2.5 |  |  | (2.5 | ) |  | (.7 | ) |  | (3.2 | )
Amortization |  | — |  |  | (21.8 | ) |  | (21.8 | ) |  | — |  |  | (18.8 | ) |  | (18.8 | )
Ending balance |  | $ | 394.7 |  |  | $ | 260.0 |  |  | $ | 654.7 |  |  | $ | 379.9 |  |  | $ | 157.6 |  |  | $ | 537.5 |
(1) During 2019, amounts include acquisitions related to Kudu, Other Operations and Embrace. During 2018, amounts include acquisitions related to NSM, Fresh Insurance and KBK. See Note 2 — “Significant Transactions”. (2) Dispositions relate to the MediaAlpha Transaction. See Note 2 — “Significant Transactions”.
(3) | The determination of the relative fair values of goodwill and other intangible assets recognized in connection with the acquisition of KBK was completed in 2019. The attribution is net of a $5.9 measurement period adjustment for contingent consideration.
(4) Impairments of $7.6 and $0.4 of goodwill and other intangible assets relate to Other Operations and $2.4 of impairments to other intangible relate to Fresh Insurance.
(5) | Measurement period adjustments relate to updated information about acquisition date fair values of assets acquired and liabilities assumed.
Amortization expense was $21.8 million, $18.8 million and $10.7 million for the years ended December 31, 2019, 2018 and 2017. White Mountains expects to recognize amortization expense in each of the next five years as the following table presents:
Millions |  | Amortization Expense
2020 |  | $ | 23.9 |
2021 |  | 30.5 |
2022 |  | 29.7 |
2023 |  | 28.4 |
2024 and years after |  | 138.9 |
Total (1) |  | $ | 251.4 |
(1) Excludes indefinite-lived intangible assets of $8.6.

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

X
- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -URI http://asc.fasb.org/topic&trid=2144416 + Details
Name: | us-gaap_GoodwillAndIntangibleAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration