Acquisitions and Divestitures

12 Months Ended

Apr. 30, 2023

Business Combination and Asset Acquisition [Abstract]

Acquisitions

Pro forma financial information related to these acquisitions has not been provided as it is not material to our consolidated results of operations.

Fiscal Year 2023

On November 1, 2022, we completed the acquisition of an immaterial business included in our Academic segment. The fair value of consideration transferred was $6.1 million, which included $5.2 million of cash at the acquisition date and $0.9 million to be paid after the acquisition date. The acquisition was accounted for using the acquisition method of accounting. We recorded the preliminary aggregate excess purchase price over identifiable net tangible and intangible assets acquired and liabilities assumed, which included a preliminary allocation of $3.9 million of goodwill allocated to the Academic segment and $3.7 million of intangible assets subject to amortization.

The allocation of the total consideration transferred to the assets acquired, including intangible assets and goodwill, and the liabilities assumed could be revised as a result of additional information obtained due to tax related matters and contingencies and certain assets and liabilities, including receivables and payables, but such amounts will be finalized within the measurement period, which will not exceed one year from the acquisition date.

Fiscal Year 2022

XYZ Media

On December 29, 2021, we completed the acquisition of certain assets of XYZ Media Inc. (XYZ Media). XYZ Media is a company that generates leads for higher education institutions. The results of XYZ Media are included in our Academic segment results. The fair value of consideration transferred at the date of acquisition was $45.4 million, which included $38.0 million of cash and approximately 129 thousand shares of Wiley Class A common stock, or approximately $7.4 million. We financed the payment of the cash consideration with a combination of cash on hand and borrowings under our Amended and Restated CA (as defined below in Note 14, “Debt and Available Credit Facilities”).

The XYZ Media acquisition was accounted for using the acquisition method of accounting. The excess purchase price over identifiable net tangible and intangible assets acquired, and liabilities assumed, has been recorded to Goodwill in our Consolidated Statements of Financial Position. Goodwill represents synergies and economies of scale expected from the combination of services. We recorded the fair value of the assets acquired and liabilities assumed on the acquisition date. The goodwill will be deductible for tax purposes. The acquisition related costs to acquire XYZ Media were expensed when incurred and were approximately $0.1 million for the year ended April 30, 2022. Such costs were allocated to the Academic segment and are reflected in Operating and administrative expenses on the Consolidated Statements of Income for the year ended April 30, 2022.

XYZ Media’s incremental revenue and operating loss included in our Academic segment results for the year ended April 30, 2023 was $6.9 million and $(3.1) million, respectively. XYZ Media’s revenue and operating loss included in our Academic segment results for the year ended April 30, 2022 was $3.6 million and $(1.5) million, respectively.

During the year ended April 30, 2023, no revisions were made to the allocation of the consideration transferred to the assets acquired and liabilities assumed. The following table summarizes the consideration transferred to acquire XYZ Media and the final allocation of the purchase price among the assets acquired and liabilities assumed.


	Final Allocation
Total consideration transferred	$	45,363

Assets:
Current assets	913
Intangible assets, net	22,711
Goodwill	22,226
Other non-current assets	46
Total assets	$	45,896

Liabilities:
Current liabilities	533
Total liabilities	$	533

The following table summarizes the identifiable intangible assets acquired and their weighted-average useful life at the date of acquisition.


	Fair Value		Weighted-Average Useful Life (in Years)
Developed technology	$	20,930	7
Customer relationships	1,340		6
Covenants not to compete	323		5
Tradename	118		1
Total	$	22,711

The allocation of the total consideration transferred to the assets acquired, including intangible assets and goodwill, and the liabilities assumed was finalized during the three months ended January 31, 2023.

Other Acquisitions in Fiscal Year 2022

On November 30, 2021, we acquired the assets of the eJournalPress (EJP) business from Precision Computer Works, Inc. EJP is a technology platform company with an established journal submission and peer review management system. The results of EJP are included in our Research segment results.

On October 1, 2021, we completed the acquisition of certain assets of J&J Editorial Services, LLC. (J&J). J&J is a publishing services company providing expert offerings in editorial operations, production, copyediting, system support, and consulting. The results of J&J are included in our Research segment results.

We also completed in the year ended April 30, 2022 the acquisition of two immaterial businesses included in our Research segment and the acquisition of one immaterial business in our Talent segment.

The aggregate fair value of consideration transferred for these other acquisitions was approximately $41.2 million during the year ended April 30, 2022. This included $36.2 million of cash paid at the acquisition dates and $5.0 million of additional cash to be paid after the acquisition dates, of which $2.0 million was paid in the year ended April 30, 2023. The fair value of the cash consideration transferred, net of $1.2 million of cash acquired was approximately $34.9 million.

These other acquisitions were accounted for using the acquisition method of accounting as of their respective acquisition dates.

Associated with these other acquisitions, the aggregate excess purchase price over identifiable net tangible and intangible assets acquired, and liabilities assumed of $24.8 million has been recorded to Goodwill on our Consolidated Statements of Financial Position as of April 30, 2022 and $15.6 million of intangible assets subject to amortization have been recorded, including developed technology, customer relationships, trademarks, covenants not to compete, and content that is being amortized over weighted-average useful lives of 4, 8, 2, 4, and 4 years, respectively. The fair value assessed for the majority of the tangible assets acquired and liabilities assumed approximated their carrying value. Goodwill represents synergies and economies of scale expected from the combination of services. Goodwill of $24.8 million has been allocated to the Research segment and none has been allocated to the Talent segment. Approximately $18.7 million of the goodwill will be deductible for tax purposes, and $6.1 million will not be deductible for tax purposes. The aggregate acquisition related costs to acquire these other acquisitions was expensed when incurred and was approximately $0.5 million for the year ended April 30, 2022. Such costs were allocated to the Research segment and are reflected in Operating and administrative expenses on the Consolidated Statements of Income for the year ended April 30, 2022.

The incremental revenue for the years ended April 30, 2023 and April 30, 2022 related to these other acquisitions was approximately $9.5 million and $8.1 million, respectively.

During the year ended April 30, 2023, the allocation of the total consideration transferred to the assets acquired, including intangible assets and goodwill, and the liabilities assumed was finalized for all of these other acquisitions.

Divestitures

As part of our ongoing initiatives to simplify our portfolio and focus our attention on strategic growth areas, we have completed two dispositions during the year ended April 30, 2023. Both were included in our Academic segment.

On February 28, 2023, we completed the sale of Wiley's Efficient Learning test prep portfolio business. In addition, on March 31, 2023, we completed the sale of our advancement courses business.

Neither dispositions constituted a strategic shift, and the impact on our overall operations and financial results was not material. Accordingly, the operations associated with the dispositions are not reported in discontinued operations. The selling price for both dispositions was $16.5 million, which included $15.5 million of cash received net of transaction costs at the date of disposition, and $1.0 million to be received after the disposition date. The pretax gain on sale of $10.2 million, after accounting for the assets sold, liabilities transferred upon sale and transaction costs, is included in Gain on sale of businesses and certain assets in our Consolidated Statements of Income for the year ended April 30, 2023. As a result of the closing of the transactions, we derecognized net assets of $6.4 million, including goodwill of $5.3 million and intangible assets of $2.4 million.