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Acquisitions and Dispositions | 12 Months Ended
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Dec. 31, 2023
Business Combinations [Abstract] |
Acquisitions and Dispositions | Acquisitions 2023 Acquisitions On November 1, 2023, the Company acquired Movers and Shakers, a digital creative company, for $15.0 million, of which $10.2 million was paid in cash and 1.0 million shares of Class A common stock, par value $0.001 per share (the “Class A Common Stock”), subject to post-closing adjustments. In connection with the acquisition, the sellers are entitled to contingent consideration up to a maximum value of $35.0 million, subject to meeting certain future earnings targets and continued employment, of which a portion may be settled in shares of Class A Common Stock at the Company’s discretion. The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributable to the assembled workforce of Movers and Shakers and expected growth related to new customer relationships. Goodwill of $8.2 million was assigned to the Integrated Agencies Network reportable segment. The goodwill is fully deductible for income tax purposes. The purchase price accounting is not yet final as the Company may still make adjustments due to changes in post-closing adjustments. On October 2, 2023, the Company acquired Left Field Labs (“LFL”), a digital experience design and strategy company, for $13.2 million, of which $9.4 million was paid in cash and 825 thousand shares of Class A Common Stock, subject to post-closing adjustments. In connection with the acquisition, the sellers are entitled to contingent consideration up to a maximum value of $51.0 million, subject to continued employment and meeting certain future earnings targets, of which a portion may be settled in shares of Class A Common Stock at the Company’s discretion. The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributable to the assembled workforce of LFL and expected growth related to new customer relationships. Goodwill of $8.7 million was assigned to the Integrated Agencies Network reportable segment. The goodwill is fully deductible for income tax purposes. The purchase price accounting is not yet final as the Company may still make adjustments due to changes in post-closing adjustments. On July 3, 2023, the Company acquired Tinsel Experiential Design LLC (“Tinsel”), a marketing and design company, for $2.5 million in cash consideration, subject to post-closing adjustments. In connection with the acquisition, the sellers are entitled to contingent consideration, subject to continued employment, and meeting certain future earnings targets. The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributable to the assembled workforce of Tinsel and expected growth related to new customer relationships. Goodwill of $1.6 million was assigned to the Integrated Agencies Network reportable segment. The goodwill is fully deductible for income tax purposes. The purchase price accounting is not yet final as the Company may still make adjustments due to changes in post-closing adjustments. On April 25, 2023, the Company acquired Huskies, Ltd. (“Huskies”), for €5.2 million ($5.6 million) of cash consideration, of which €0.9 million ($1.0 million) is deferred, subject to post-closing adjustments. The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributable to the assembled workforce of Huskies and expected growth related to new customer relationships and geographic expansion. Goodwill of $2.6 million was assigned to the Brand Performance Network reportable segment. The goodwill is non-deductible for income tax purposes. The purchase price accounting is not yet final as the Company may still make adjustments due to changes in post-closing adjustments. 2022 Acquisitions Acquisition of Brand New Galaxy On April 19, 2022, the Company acquired Brand New Galaxy (“BNG”), for $20.9 million of cash consideration, as well as contingent consideration up to a maximum value of $50.0 million. The contingent consideration is due upon meeting certain future earnings targets through 2024, with approximately 67% payable in cash and 33% payable in shares of Class A Common Stock. The consideration has been allocated to the assets acquired and assumed liabilities of BNG based upon fair values, with any excess purchase price allocated to goodwill. The purchase price allocation is as follows:
|  | Amount
|  | (dollars in thousands)
Cash and cash equivalents |  | $ | 2,766 |
Accounts receivable |  | 10,147 |
Other current assets |  | 671 |
Fixed assets |  | 1,587 |
Identifiable intangible assets |  | 12,740 |
Other assets |  | 1,583 |
Accounts payable |  | (4,771) |
Accruals and other liabilities |  | (6,880) |
Advance billings |  | (1,159) |
Other liabilities |  | (3,642) |
Net assets assumed |  | 13,042 |
Goodwill |  | 24,643 |
Purchase price consideration |  | $ | 37,685 |
The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributable to the assembled workforce of BNG. Goodwill of $24.6 million was assigned to the Brand Performance Network reportable segment. The majority of the goodwill is non-deductible for income tax purposes. Intangible assets consist of trade names, customer relationships and developed technology. We amortize purchased intangible assets on a straight-line basis over their respective useful lives. The weighted average life of the total acquired identifiable intangible assets is approximately ten years. The following table presents the details of identifiable intangible assets acquired:
|  | Fair Value |  | Estimated Useful Life in Years
|  | (dollars in thousands)
Customer relationships |  | $ | 6,150 |  |  | 10
Trade names |  | 5,500 |  |  | 10
Developed technology |  | 1,090 |  |  | 7
Total acquired intangible assets |  | $ | 12,740 |  |  |
Pro Forma Financial Information The unaudited pro forma information for the periods set forth below gives effect to the acquisition as if it occurred as of January 1, 2021. The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisition been consummated as of that time.
|  |  |  | Year Ended December 31, 2022 |  | Year Ended December 31, 2021
|  |  | (dollars in thousands)
Revenue |  |  |  | $ | 2,698,018 |  |  | $ | 1,501,568 |
Net income |  |  |  | $ | 49,299 |  |  | $ | 36,864 |
Revenue attributable to BNG, included within the Consolidated Statements of Operations for the year ended December 31, 2023 was $30.1 million, and Net loss was $1.5 million. Revenue attributable to BNG, included within the Consolidated Statements of Operations for the year ended December 31, 2022 was $20.5 million, and Net income was $0.1 million. Acquisition of TMA Direct, Inc. On May 31, 2022, the Company acquired approximately 87% of TMA Direct, Inc. (“TMA Direct”) for $17.2 million of cash consideration and $0.5 million of deferred acquisition payments. The Company was also granted an option to purchase the remaining 13% minority interest in TMA Direct for up to $13.3 million. The consideration has been allocated to the assets acquired and assumed liabilities of TMA Direct based upon fair values, with any excess purchase price allocated to goodwill. The purchase price allocation is as follows:
|  | Amount
|  | (dollars in thousands)
Accounts receivable |  | $ | 582 |
Other current assets |  | 669 |
Identifiable intangible assets |  | 13,200 |
Accounts payable |  | (379) |
Other liabilities |  | (270) |
Noncontrolling interests |  | (2,667) |
Net assets assumed |  | 11,135 |
Goodwill |  | 6,569 |
Purchase price consideration |  | $ | 17,704 |
The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributable to the assembled workforce of TMA Direct. Goodwill of $6.6 million was assigned to the Communications Network reportable segment. The majority of the goodwill is deductible for income tax purposes. Intangible assets consist of trade names and customer relationships. We amortize purchased intangible assets on a straight-line basis over their respective useful lives. The weighted average life of the total acquired identifiable intangible assets is ten years. The following table presents the details of identifiable intangible assets acquired:
|  | Fair Value |  | Estimated Useful Life in Years
|  | (dollars in thousands)
Customer relationships |  | $ | 11,400 |  |  | 10
Trade names |  | 1,800 |  |  | 10
Total acquired intangible assets |  | $ | 13,200 |  |  |
Pro Forma Financial Information The unaudited pro forma information for the periods set forth below gives effect to the acquisition as if it occurred as of January 1, 2021. The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisition been consummated as of that time.
|  |  |  | Year Ended December 31, 2022 |  | Year Ended December 31, 2021
|  |  |  | (dollars in thousands)
Revenue |  |  |  | $ | 2,691,622 |  |  | $ | 1,481,727 |
Net income |  |  |  | $ | 51,397 |  |  | $ | 39,386 |
Revenue attributable to TMA Direct, included within the Consolidated Statements of Operations for the year ended December 31, 2023 was $11.0 million, and Net income was $1.1 million. Revenue attributable to TMA Direct, included within the Consolidated Statements of Operations for the year ended December 31, 2022 was $7.7 million, and Net income was $0.9 million. Acquisition of Maru Group Limited Ltd. On October 3, 2022, the Company acquired Maru Group Limited Ltd. (“Maru”) for £23.0 million ($25.8 million) in cash consideration. The consideration has been allocated to the assets acquired and assumed liabilities of Maru based upon fair values, with any excess purchase price allocated to goodwill. The purchase price allocation is as follows:
|  | Amount
|  | (dollars in thousands)
Cash and cash equivalents |  | $ | 1,033 |
Accounts receivable |  | 7,374 |
Other current assets |  | 899 |
Fixed assets |  | 157 |
Identifiable intangible assets |  | 14,300 |
Other assets |  | 1,920 |
Accounts payable |  | (4,087) |
Accruals and other liabilities |  | (9,154) |
Advance billings |  | (6,462) |
Deferred tax liability |  | (3,328) |
Other liabilities |  | (2,891) |
Net assets assumed |  | (239) |
Goodwill |  | 26,033 |
Purchase price consideration |  | $ | 25,794 |
The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributable to the assembled workforce of Maru and expected growth related to new customer relationships and geographic expansion. Goodwill of $26.0 million was assigned to the All Other reportable segment. The goodwill is partially deductible for income tax purposes. Intangible assets consist of trade names, customer relationships, and developed technology. We amortize purchased intangible assets on a straight-line basis over their respective useful lives. The weighted average life of the total acquired identifiable intangible assets is approximately eight years. The following table presents the details of identifiable intangible assets acquired:
|  | Fair Value |  | Estimated Useful Life in Years
|  | (dollars in thousands)
Customer relationships |  | $ | 4,900 |  |  | 10
Trade names |  | 4,000 |  |  | 10
Developed technology |  | 5,400 |  |  | 2-7
Total acquired intangible assets |  | $ | 14,300 |  |  |
Pro Forma Financial Information The unaudited pro forma information for the periods set forth below gives effect to the acquisition as if it occurred as of January 1, 2021. The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisition been consummated as of that time.
|  | Year Ended December 31,
|  | 2022 |  | 2021
|  | (dollars in thousands)
Revenue |  | $ | 2,717,667 |  |  | $ | 1,512,791 |
Net income |  | $ | 36,043 |  |  | $ | 15,167 |
Revenue attributable to Maru, included within the Consolidated Statements of Operations for the year ended December 31, 2023 was $32.1 million and Net loss was $10.8 million. Revenue attributable to Maru, included within the Consolidated Statements of Operations for the year ended December 31, 2022 was $8.8 million, and Net loss was $2.1 million. Acquisition of Wolfgang, LLC. On October 3, 2022, the Company acquired the remaining 80% interest that it did not already own in Wolfgang, LLC (“Wolfgang”) for $3.8 million in cash consideration and 175 thousand shares of Class A Common Stock with a fair value of $1.2 million. The consideration has been allocated to the assets acquired and assumed liabilities of Wolfgang based upon fair values, with any excess purchase price allocated to goodwill. The purchase price allocation is as follows:
|  | Amount
|  | (dollars in thousands)
Cash and cash equivalents |  | $ | 1,606 |
Accounts receivable |  | 1,180 |
Other current assets |  | 100 |
Identifiable intangible assets |  | 1,055 |
Other assets |  | 46 |
Current liabilities |  | (278) |
Net assets assumed |  | 3,709 |
Goodwill |  | 2,451 |
Purchase price consideration including fair value of previously owned interest |  | $ | 6,160 |
The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributable to the assembled workforce of Wolfgang. Goodwill of $2.5 million was assigned to the Integrated Agencies Network reportable segment. The majority of the goodwill is deductible for income tax purposes. Intangible assets consist of customer relationships. We amortize purchased intangible assets on a straight-line basis over their respective useful lives. The weighted average life of the total acquired identifiable intangible assets is approximately five years. Pro Forma Financial Information The unaudited pro forma information for the periods set forth below gives effect to the acquisition as if it occurred as of January 1, 2021. The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisition been consummated as of that time.
|  | Year Ended December 31,
|  | 2022 |  | 2021
|  | (dollars in thousands)
Revenue |  | $ | 2,696,733 |  |  | $ | 1,474,303 |
Net income |  | $ | 51,398 |  |  | $ | 36,538 |
Revenue attributable to Wolfgang, included within the Consolidated Statements of Operations for the year ended December 31, 2023 was $5.7 million, and Net income was $0.7 million. Revenue attributable to Wolfgang, included within the Consolidated Statements of Operations for the year ended December 31, 2022 was $2.1 million, and Net loss was $0.3 million. Acquisition of Epicenter Experience LLC. On October 3, 2022, the Company acquired the assets of Epicenter Experience LLC (“Epicenter”) for $9.9 million in cash consideration, as well as contingent consideration up to a maximum value of $5.0 million. The contingent consideration is subject to meeting certain future earnings targets through 2024 and can be paid up to 25% in shares of Class A Common Stock. The consideration has been allocated to the assets acquired and assumed liabilities of Epicenter based upon fair values. The purchase price allocation is as follows:
|  | Amount
|  | (dollars in thousands)
Accounts receivable |  | $ | 901 |
Other current assets |  | 45 |
Identifiable intangible assets |  | 7,300 |
Accounts payable |  | (148) |
Other current liabilities |  | (650) |
Net assets assumed |  | 7,448 |
Goodwill |  | 4,416 |
Purchase price consideration |  | $ | 11,864 |
The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributable to the assembled workforce of Epicenter. Goodwill of $4.4 million was assigned to the All Other reportable segment. The majority of the goodwill is deductible for income tax purposes. The intangible asset acquired was developed technology. We amortize purchased intangible assets on a straight-line basis over their respective useful lives. The weighted average life of the total acquired identifiable intangible assets is approximately five years. Pro Forma Financial Information The unaudited pro forma information for the periods set forth below gives effect to the acquisition as if it occurred as of January 1, 2021. The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisition been consummated as of that time.
|  | Year Ended December 31,
|  | 2022 |  | 2021
|  | (dollars in thousands)
Revenue |  | $ | 2,690,969 |  |  | $ | 1,473,183 |
Net income |  | $ | 49,652 |  |  | $ | 35,810 |
Revenue attributable to Epicenter, included within the Consolidated Statements of Operations for the year ended December 31, 2023 was $4.3 million, and Net loss was $0.7 million. Revenue attributable to Epicenter, included within the Consolidated Statements of Operations for the year ended December 31, 2022 was $1.0 million, and Net loss was $1.2 million. 2021 Acquisitions Acquisition of MDC On December 21, 2020, MDC and Stagwell Media announced that they had entered into the Transaction Agreement, providing for the combination of MDC with the operating businesses and subsidiaries of the Stagwell Subject Entities. The Stagwell Subject Entities comprised Stagwell Marketing and its direct and indirect subsidiaries. On August 2, 2021 (the “Closing Date”), we completed the combination of MDC and the Stagwell Subject Entities and a series of steps and related transactions (such combination and transactions, the “Transactions”). In connection with the Transactions, among other things, (i) MDC completed a series of transactions pursuant to which it emerged as a wholly owned subsidiary of the Company, converted into a Delaware limited liability company and changed its name to Midas OpCo Holdings LLC (“OpCo”), (which name was subsequently to Stagwell Global LLC); (ii) Stagwell Media contributed the equity interests of Stagwell Marketing and its direct and indirect subsidiaries to OpCo; and (iii) the Company converted into a Delaware corporation, succeeded MDC as the publicly-traded company and changed its name to Stagwell Inc. In respect of the Transactions, the acquired assets and assumed liabilities, together with acquired processes and employees, represent a business as defined in the FASB’s Accounting Standards Codification (“ASC”) 805, Business Combinations (“ASC 805”). The Transactions were accounted for as a reverse acquisition using the acquisition method of accounting, pursuant to ASC Topic 805-10, Business Combinations, with MDC treated as the legal acquirer and SMG treated as the accounting acquirer. In identifying SMG as the acquiring entity for accounting purposes, MDC and SMG took into account a number of factors, including the relative voting rights and the corporate governance structure of the Company. SMG is considered the accounting acquirer since Stagwell Media controls the board of directors of the Company following the Transactions and received an indirect ownership interest in the Company’s only operating subsidiary, OpCo, of 69.55% ownership of OpCo’s common units. However, no single factor was the sole determinant in the overall conclusion that Stagwell is the acquirer for accounting purposes; rather all factors were considered in arriving at such conclusion. Under the acquisition method of accounting, the assets and liabilities of MDC, as the accounting acquiree, were recorded at their respective fair value as of the date the Transactions were completed. On August 2, 2021, an aggregate of 180.0 million shares of the Company’s Class C Common Stock were issued to Stagwell Media in exchange for $1.80. The Class C Common Stock does not participate in the earnings of the Company. Additionally, an aggregate of 180.0 million OpCo common units were issued to Stagwell Media in exchange for the equity interests of the Stagwell Subject Entities (the “Stagwell OpCo Contribution”). The fair value of the purchase consideration was $429.1 million, consisting of 80.0 million shares of the Company’s Class A Common Stock, Class B common stock, par value $0.001 per share (the “Class B Common Stock”), and common stock equivalents based on a per share price of $5.42, the closing stock price on the date of the combination. ASC 805 requires the allocation of the purchase price consideration to the fair value of the identified assets acquired and liabilities assumed upon consummation of a business combination. For this purpose, fair value shall be determined in accordance with the fair value concepts defined in ASC 820, “Fair Value Measurements and Disclosures,” (“ASC 820”). Fair value is defined in ASC 820 as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” Fair value measurements can be highly subjective and can involve a high degree of estimation. The purchase price valuation was completed during the third quarter of 2022. The purchase price allocation is as follows:
|  | Amount
|  | (dollars in thousands)
Cash and cash equivalents |  | $ | 130,197 |
Accounts receivable |  | 398,736 |
Other current assets |  | 41,291 |
Fixed assets |  | 81,343 |
Right-of-use lease assets - operating leases |  | 252,739 |
Identifiable intangible assets |  | 810,900 |
Other assets |  | 18,282 |
Accounts payable |  | (139,590) |
Accruals and other liabilities |  | (307,439) |
Advance billings |  | (211,212) |
Current portion of lease liabilities |  | (54,009) |
Current portion of deferred acquisition consideration |  | (53,054) |
Long-term debt |  | (901,736) |
Revolving credit facility |  | (109,954) |
Long-term portion of deferred acquisition consideration |  | (8,056) |
Long-term portion of lease liabilities |  | (283,637) |
Other liabilities |  | (139,026) |
Redeemable noncontrolling interests |  | (25,990) |
Preferred shares |  | (209,980) |
Noncontrolling interests |  | (151,090) |
Net liabilities assumed |  | (861,285) |
Goodwill |  | 1,290,347 |
Purchase price consideration |  | $ | 429,062 |
The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributed to the assembled workforce of MDC. Goodwill of $932.6 million, $285.4 million and $72.4 million was assigned to the Integrated Agencies Network, the Brand Performance Network and the Communications Network reportable segments, respectively. The majority of the goodwill is non-deductible for income tax purposes. Goodwill has been updated from the previously reported amount of $1,299.4 million as of December 31, 2021 to reflect a change in certain assets and liabilities. There has been no change that impacts the Consolidated Statement of Operations. Intangible assets consist of trade names and customer relationships. We amortize purchased intangible assets on a straight-line basis over their respective useful lives. The weighted average life of the total acquired identifiable intangible assets is approximately thirteen years. The following table presents the details of identifiable intangible assets acquired:
|  | Fair Value |  | Estimated Useful Life in Years
|  | (dollars in thousands)
Trade Names |  | $ | 98,000 |  |  | 10
Customer Relationships |  | 712,900 |  |  | 6-15
Total Acquired Intangible Assets |  | $ | 810,900 |  |  |
Pro Forma Financial Information (unaudited) The unaudited pro forma information for the periods set forth below gives effect to the acquisition as if it occurred as of January 1, 2020. The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisitions been consummated as of that time.
|  |  |  | Years Ended December 31,
|  |  |  | 2021 |  | 2020
|  |  |  | (dollars in thousands)
Revenue |  |  |  | $ | 2,224,343 |  |  | $ | 2,087,025 |
The pro forma net loss was nominal for the years ended December 31, 2021 and 2020. Revenue attributable to MDC, included within the year ended December 31, 2021 Consolidated Statements of Operations was $605.4 million. The net loss included within the year ended December 31, 2021 Consolidated Statements of Operations was nominal. Transaction expenses were $15.0 million for the twelve months ended December 31, 2021. Acquisition of GoodStuff Holdings Limited On December 31, 2021, the Company acquired GoodStuff Holdings Limited (“Goodstuff”) for £21.0 million ($28.2 million) of cash consideration as well as contingent consideration up to a maximum of £22.0 million. The cash consideration included an initial payment of £8.0 million, an excess working capital payment of £9.0 million and £4.0 million of deferred payments. The contingent consideration is tied to employees’ service and will be recognized as deferred acquisition consideration expense through 2026. Therefore, only the cash consideration has been allocated to the $23.8 million of assets acquired and assumed liabilities of Goodstuff based upon their fair values, with any excess purchase price allocated to goodwill. The excess of purchase consideration over the fair value of the net assets acquired was recorded as goodwill, which is primarily attributed to the assembled workforce of Goodstuff. Goodwill of $4.4 million was assigned to the Brand Performance Network reportable segment. The majority of the goodwill is non-deductible for income tax purposes. Intangible assets consist of trade names and customer relationships. We amortize purchased intangible assets on a straight-line basis over their respective useful lives. The weighted average life of the total acquired identifiable intangible assets is approximately ten years. Trade names had a fair value of $1.3 million with an estimated useful life of fifteen years, and customer relationships had a fair value of $13.6 million with an estimated useful life of ten years. Pro Forma Financial Information (unaudited) The unaudited pro forma information for the periods set forth below gives effect to the acquisition as if it occurred as of January 1, 2020. The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisitions been consummated as of that time. For the years ended December 31, 2021 and 2020, pro forma revenue was $1,488.5 million and $902.6 million, respectively, and net income was $38.7 million and $72.7 million, respectively. Other Acquisitions On July 12, 2022, the Company acquired PEP Group Holdings B.V., an omnichannel content creation and adaption production company for $0.5 million in cash consideration, as well as contingent consideration up to a maximum value of €2.6 million. The contingent consideration is subject to meeting certain future earnings targets through 2025. On July 15, 2022, the Company acquired Apollo Program II Inc., a real-time artificial intelligence-powered software-as-a-service platform, for $2.3 million in cash consideration, as well as guaranteed deferred payments of $1.0 million and $1.5 million on or prior to July 1, 2023 and July 1, 2024, respectively. Dispositions On October 31, 2023, the Company sold ConcentricLife, which was included in Integrated Agencies Network, to a strategic buyer for $245.0 million in cash resulting in a pre-tax gain of $94.5 million. The gain was recognized within Gain on sale of business within the Consolidated Statements of Operations. The divestiture did not represent a strategic shift that would have a major effect on the Company’s consolidated results of operations, and therefore its results of operations were not reported as discontinued operations. On September 15, 2021, the Company sold Reputation Defender, which was included in All Other Network, to a strategic buyer for $40.0 million resulting in a gain of $43.0 million. The gain was recognized within Gain on sale of business within the Consolidated Statements of Operations. The divestiture did not represent a strategic shift that would have a major effect on the Company’s consolidated results of operations, and therefore its results of operations were not reported as discontinued operations. 2022 Purchases of Noncontrolling Interests On April 1, 2022, the Company acquired the remaining interest in Hello Design, LLC (“Hello Design”) that it did not already own for an aggregate purchase price of $4.6 million, comprised of a closing cash payment of $3.6 million and a contingent deferred acquisition payment of $1.0 million. The contingent deferred payment of $1.0 million was paid in the second quarter of 2023. 2021 Purchases of Noncontrolling Interests On October 1, 2021, the Company entered into an agreement to purchase the approximate 27% remaining interest of Targeted Victory it did not already own, stipulating the purchase of 13.3% on October 1, 2021 and the remaining 13.3% on July 31, 2023. The purchase price of $73.9 million was comprised of a contingent deferred acquisition payment and redeemable noncontrolling interest with estimated present values at the acquisition date of $46.6 million and $27.3 million, respectively. The contingent deferred payment and redeemable noncontrolling interest were based on the financial results of the underlying business through July 2023 and July 2025, respectively. In addition, at the option of the Company, up to 50% of the total purchase price can be paid in shares of Class A Common Stock and in no event may the purchase price exceed $135.0 million. On December 1, 2021, the Company acquired the approximate 27% remaining interest of ConcentricLife it did not already own for an aggregate purchase price of $8.1 million, comprised of a closing cash payment of $1.6 million and contingent deferred acquisition payments with an estimated present value at the acquisition date of $6.5 million. The contingent deferred payments were based on the financial results of the underlying business. On December 31, 2021, the Company acquired the approximate 49% remaining interest of Instrument it did not already own for an aggregate purchase price of $157.1 million, comprised of a closing payment of $37.5 million in cash and $37.5 million in shares of Class A Common Stock and deferred acquisition payments with an estimated present value at the acquisition date of $82.1 million, with approximately 40% to be paid in shares of Class A Common Stock. The deferred payments are not contingent. 9. Deferred Acquisition Consideration Deferred acquisition consideration on the Consolidated Balance Sheets consists of deferred obligations related to contingent and fixed purchase price payments, and contingent and fixed retention payments tied to continued employment of specific personnel. Arrangements that are not contingent upon future employment are initially measured at the acquisition date fair value and are remeasured at each reporting period within Office and general expenses on the Consolidated Statements of Operations. Arrangements that are contingent upon future employment are expensed as earned over the respective vesting (employment) period within Office and general expenses on the Consolidated Statements of Operations. The following table presents changes in deferred acquisition consideration and a reconciliation to the amounts reported on the Consolidated Balance Sheets as of December 31, 2023 and December 31, 2022:
| December 31, 2023 |  | December 31, 2022
| (dollars in thousands)
Beginning balance | $ | 161,323 |  |  | $ | 222,369 |
Payments (1) | (97,447) |  |  | (74,963) |
Adjustments to deferred acquisition consideration (2) | 14,303 |  |  | (12,779) |
Additions (3) | 22,172 |  |  | 26,594 |
Currency translation adjustment | 680 |  |  | (758) |
Other | 27 |  |  | 860 |
Ending balance (4) | $ | 101,058 |  |  | $ | 161,323 |
(1) Includes deferred acquisition consideration payments settled in shares of Class A Common Stock of $32.8 million and $1.0 million, respectively, for the period ended December 31, 2023 and December 31, 2022. (2) Adjustments to deferred acquisition consideration contains fair value changes from the Company’s initial estimates of deferred acquisition payments and accretion of expense as awards are earned over the vesting period. (3) In 2021, the Company entered into an agreement to purchase the remaining 26.7% interest in Targeted Victory it did not previously own. The agreement provided for the purchase of 50% of the interest on October 1, 2021 (paid in October 2023) and 50% on July 31, 2023 (payable in October 2025 with a seller’s right to defer until October 2027). In connection with the purchase, the estimated amount payable in October 2025, was reclassified from redeemable noncontrolling interest to deferred acquisition consideration. (4) The contingent and fixed deferred acquisition consideration obligation was $57.5 million and $43.6 million, respectively, as of December 31, 2023 and $69.9 million and $91.4 million, respectively, as of December 31, 2022. The deferred acquisition consideration as of December 31, 2023 and December 31, 2022, includes $29.3 million and $51.6 million, respectively, expected to be settled in shares of Class A Common Stock.

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