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Acquisitions | 12 Months Ended
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Mar. 31, 2024
Business Combinations [Abstract] |
Acquisitions | Note 4 — Acquisitions Inmarsat Acquisition On May 30, 2023, the Company completed the acquisition of all outstanding shares of Inmarsat Holdings, a privately held leading provider of global mobile satellite communications services. The Inmarsat Acquisition positions the Company as a leading global communications innovator with enhanced scale and scope to connect the world affordably, securely and reliably. The complementary assets and resources of the combined company position the Company to provide advanced new services in mobile and fixed segments, driving greater customer choice in broadband communications and narrowband services (including the Internet of Things (IoT)). These benefits and additional opportunities were among the factors that contributed to a purchase price resulting in the recognition of preliminary estimated goodwill of $975.3 million and $487.6 million which was recognized in the Company's satellite services and government systems segments, respectively. The goodwill recognized was not deductible for U.S. and foreign income tax purposes. In connection with the closing of the Inmarsat Acquisition, the Company's certificate of incorporation was amended to increase the number of shares of common stock authorized for issuance from 100,000,000 to 200,000,000 as previously approved by the Company's stockholders at a special meeting held on June 21, 2022. The consideration transferred of approximately $2.7 billion was comprised of $2.1 billion of the fair value of approximately 46.36 million shares of the Company’s common stock issued at the closing of the transaction and $550.7 million in cash consideration. In connection with the Inmarsat Acquisition, the Company recorded acquisition-related transaction costs of $31.3 million, $40.4 million and $26.3 million during fiscal years 2024, 2023 and 2022, respectively, included in selling, general and administrative expenses. The purchase price allocation is preliminary primarily due to the pending finalization of the Company’s valuation analysis and review of various tax attributes. The Company allocated the purchase price to tangible and intangible assets acquired and liabilities assumed based on the preliminary estimates of their fair values, which is subject to adjustment for up to one year after the closing of the Inmarsat Acquisition as additional information is obtained. The preliminary purchase price allocation of the acquired assets and assumed liabilities in the Inmarsat Acquisition based on the preliminary estimated fair values as of May 30, 2023, adjusted since the closing of the Inmarsat Acquisition, primarily between property, equipment and satellites, identifiable intangible assets, deferred tax liabilities and goodwill, is as follows:
|  | (In thousands) |
Current assets |  | $ | 641,893 |
Property, equipment and satellites |  |  | 4,363,049 |
Identifiable intangible assets |  |  | 2,570,000 |
Other assets |  |  | 388,745 |
Total assets acquired |  | $ | 7,963,687 |
Current liabilities |  |  | (598,296 | )
Long-term debt, excluding short-term portion |  |  | (3,519,774 | )
Other long-term liabilities |  |  | (2,629,406 | )
Total liabilities assumed |  | $ | (6,747,476 | )
Goodwill |  |  | 1,462,881 |
Total consideration transferred |  | $ | 2,679,092 |
Current liabilities and other long-term liabilities include approximately $29.6 million and $248.3 million, respectively, of unfavorable contract liabilities amortized into service revenue over a weighted average estimated useful life of approximately nine years. Estimated amounts assigned to identifiable intangible assets are being amortized on a straight-line basis over their estimated useful lives (which approximates the economic pattern of benefit) and are as follows as of May 30, 2023:
|  |  |  |  | Weighted |
|  | Estimated Fair Value |  |  | Average Estimated Useful Life |
|  | (In thousands) |  |  | (In years) |
Orbital slots and spectrum assets |  | $ | 1,080,000 |  |  |  | 12 |
Customer relationships |  |  | 1,305,000 |  |  |  | 11 |
Technology |  |  | 100,000 |  |  |  | 7 |
Trade name |  |  | 85,000 |  |  |  | 8 |
Total identifiable intangible assets |  | $ | 2,570,000 |  |  |  | 11 |
Management determined the fair value of acquired customer relationships by applying the multi-period excess earnings method, which involved the use of significant judgments and assumptions related to revenue growth rates, customer attrition rates, discount rates, and contributory asset charges. Additionally, management determined the fair value of acquired orbital slots and spectrum assets using an avoided cost method, which involved the use of significant judgments and assumptions related to hypothetical lease payments, discount rates, and contributory asset charges. The intangible assets acquired in the Inmarsat Acquisition were determined in accordance with the authoritative guidance for business combinations (ASC 805), based on estimated fair values using valuation techniques consistent with the market approach, income approach and/or cost approach to measure fair value. The consolidated financial statements include the operating results of Inmarsat from the date of acquisition. Since the acquisition date on May 30, 2023, the Company recorded approximately $1.4 billion in revenue during fiscal year 2024, and $214.6 million of net loss during fiscal year 2024, with respect to the Inmarsat business (primarily in the Company’s satellite services segment, with a portion included in its government systems segment and an insignificant amount included in its commercial networks segment) in the consolidated statements of operations. In November 2023, as a part of an important milestone in the Company’s integration program following the Inmarsat Acquisition and as part of the Company’s ongoing strategy to streamline operations and better serve the Company’s growing customer base, the Company completed work on the rationalization of roles in the Company’s global business, which is intended to achieve both operational and cost efficiencies. As part of the role rationalization, the Company reduced its global workforce and recorded total costs (primarily related to employee severance payments, benefits and related termination costs) of approximately $48 million during fiscal year 2024. These one-time costs were recorded within operating expenses in the Company’s consolidated statements of operations across all three of the Company’s segments. Unaudited Pro Forma Financial Information The unaudited financial information in the table below summarizes the combined results of operations for the Company and Inmarsat on a pro forma basis, as though the companies had been combined as of the beginning of fiscal year 2023, April 1, 2022. The pro forma information is presented for informational purposes only and may not be indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of the related fiscal periods. The pro forma financial information for the fiscal years ended March 31, 2024 and 2023 includes the business combination accounting effects primarily related to the amortization and depreciation changes from acquired intangible and tangible assets, interest expense from the debt issued to finance the acquisition, acquisition-related transaction costs and related tax effects.
|  | Fiscal Years Ended |
|  | March 31, 2024 |  |  | March 31, 2023 |
|  | (In thousands) |
Total revenues |  | $ | 4,565,433 |  |  | $ | 4,176,091 |
Net income (loss) attributable to Viasat, Inc. |  | $ | (1,014,047 | ) |  | $ | 896,887 |
Euro Broadband Infrastructure Sàrl On April 30, 2021, the Company acquired the remaining 51% interest in EBI, a broadband services provider, from Eutelsat. By completing the acquisition, the Company gained 100% ownership and control of EBI and the KA-SAT satellite over EMEA and related ground infrastructure. Goodwill recognized in the transaction was recorded within the Company's satellite services segment. The goodwill recognized was not deductible for U.S. and foreign income tax purposes. Prior to the acquisition date, the Company owned a 49% interest in EBI and accounted for the investment using the equity method of accounting. The acquisition of the remaining equity interest in EBI was accounted for as a step acquisition in accordance with ASC 805. Accordingly, the Company allocated the purchase price of the acquired company to the net tangible assets and intangible assets acquired based upon their estimated fair values. The Company remeasured the previously held equity method investment to its fair value based upon a valuation of the acquired business, as of the date of acquisition. The Company considered multiple factors in determining the fair value of the previously held equity method investment, including, (i) the price negotiated with the selling shareholder for the remaining 51% interest in EBI and (ii) an income valuation model (discounted cash flow). As a result of the equity method investment remeasurement, recognition of previously unrecognized foreign currency gain and settlement of insignificant preexisting relationships, the Company recognized an insignificant total net gain included in other income, net, in the consolidated statements of operations and comprehensive income (loss) in the first quarter of fiscal year 2022. The purchase price of $327.4 million was primarily comprised of $167.0 million of cash, net of a then estimated immaterial amount of purchase price consideration and the fair value of previously held equity method investment of approximately $160.4 million. The previously estimated purchase price consideration was determined approximately two years after the closing date, and as a result the Company received €20.0 million, or approximately $22.0 million during the second quarter of fiscal year 2024 (see Note 3 — Fair Value Measurements for more information). After consideration of cash paid, approximately $121.7 million of EBI’s cash on hand and receipt of $22.0 million, the transaction resulted in a net cash outlay of approximately $29.0 million. The purchase price allocation of the acquired assets and assumed liabilities based on the estimated fair values as of April 30, 2021, slightly adjusted since the close of the acquisition, primarily between goodwill, identifiable intangible assets and property, equipment and satellites, is as follows:
|  | (In thousands) |
Current assets |  | $ | 154,207 |
Property, equipment and satellites |  |  | 109,028 |
Identifiable intangible assets |  |  | 26,574 |
Other assets |  |  | 795 |
Total assets acquired |  | $ | 290,604 |
Total liabilities assumed |  | $ | (5,914 | )
Goodwill |  |  | 42,662 |
Total consideration transferred |  | $ | 327,352 |
Amounts assigned to identifiable intangible assets are being amortized on a straight-line basis over their determined useful lives (which approximates the economic pattern of benefit) and are as follows as of April 30, 2021:
|  |  |  |  | Weighted |
|  | Fair Value |  |  | Average Useful Life |
|  | (In thousands) |  |  | (In years) |
Customer relationships |  | $ | 17,877 |  |  |  | 8 |
Other |  |  | 7,851 |  |  |  | 7 |
Trade name |  |  | 846 |  |  |  | 2 |
Total identifiable intangible assets |  | $ | 26,574 |  |  |  | 8 |
At the closing of the acquisition, EBI became a wholly owned subsidiary of the Company and EBI’s operations have been included in the Company’s consolidated financial statements in the Company’s satellite services segment (with an insignificant amount included in the Company's commercial networks segment) commencing on the acquisition date. As EBI’s results of operations are not material to the Company’s consolidated results of operations, pro forma results of operations for this acquisition have not been presented. RigNet, Inc. On April 30, 2021, the Company completed the acquisition of all outstanding shares of RigNet, a publicly held leading provider of ultra-secure, intelligent networking solutions and specialized applications. Goodwill recognized in the transaction was recorded within the Company's satellite services segment. The goodwill recognized was not deductible for U.S. and foreign income tax purposes. The consideration transferred of approximately $317.9 million was primarily comprised of $207.2 million of the fair value of approximately 4.0 million shares of the Company’s common stock issued at the closing date, $107.3 million related to the pay down of outstanding borrowings of RigNet’s revolving credit facility, a de minimis amount in cash consideration in respect of fractional shares to the former shareholders of RigNet and an insignificant amount of other consideration. In connection with the RigNet acquisition, the Company recorded approximately $7.2 million of merger-related transaction costs in the fiscal year ended March 31, 2022, included in selling, general and administrative expenses. The purchase price allocation of the acquired assets and assumed liabilities based on the estimated fair values as of April 30, 2021 is as follows:
|  | (In thousands) |
Current assets |  | $ | 88,166 |
Property, equipment and satellites |  |  | 63,191 |
Identifiable intangible assets |  |  | 221,540 |
Other assets |  |  | 13,350 |
Total assets acquired |  | $ | 386,247 |
Current liabilities |  |  | (66,006 | )
Other long-term liabilities |  |  | (31,433 | )
Total liabilities assumed |  | $ | (97,439 | )
Goodwill |  |  | 29,132 |
Total consideration transferred |  | $ | 317,940 |
Amounts assigned to identifiable intangible assets are being amortized on a straight-line basis over their determined useful lives (which approximates the economic pattern of benefit) and are as follows as of April 30, 2021:
|  |  |  |  | Weighted |
|  | Fair Value |  |  | Average Useful Life |
|  | (In thousands) |  |  | (In years) |
Technology |  | $ | 85,440 |  |  |  | 8 |
Customer relationships |  |  | 101,920 |  |  |  | 12 |
Trade name |  |  | 25,540 |  |  |  | 8 |
Other |  |  | 8,640 |  |  |  | 12 |
Total identifiable intangible assets |  | $ | 221,540 |  |  |  | 10 |
Management determined the fair value of acquired customer relationships intangible asset by applying the multi-period excess earnings method, which involved the use of significant estimates and assumptions related to forecasted revenue growth rate, gross margin, contributory asset charges, customer attrition rate and discount rate. In connection with the acquisition, the Company assumed a contingent liability associated with a RigNet predecessor subsidiary of approximately $13.8 million, which represented the maximum amount payable under the terms of the agreement. As of March 31, 2024, no amount remains payable as the maximum amount payable was paid during the first and second quarters of fiscal year 2022. The consolidated financial statements include the operating results of RigNet from the date of acquisition. Since the acquisition date on April 30, 2021, the Company recorded approximately $180.2 million in revenue for the fiscal year ended March 31, 2022, and $31.2 million of net losses for the fiscal year ended March 31, 2022, with respect to the RigNet business primarily in the Company’s satellite services segment (with a portion included in its commercial networks segment) in the consolidated statements of operations. Unaudited Pro Forma Financial Information The unaudited financial information in the table below summarizes the combined results of operations for the Company and RigNet on a pro forma basis, as though the companies had been combined as of the beginning of fiscal year 2021, April 1, 2020. The pro forma information is presented for informational purposes only and may not be indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of the related fiscal periods. The pro forma financial information for the fiscal year ended March 31, 2022 includes the business combination accounting effects primarily related to the amortization and depreciation changes from acquired intangible and tangible assets, acquisition-related transaction costs and related tax effects.
|  | Fiscal Year Ended |
|  | March 31, 2022 |
|  | (In thousands) |
Total revenues |  | $ | 2,799,252 |
Net income (loss) attributable to Viasat, Inc. |  | $ | (19,957 | )

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