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Business Combinations | 9 Months Ended
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Sep. 30, 2018
Business Combinations [Abstract] |
Business Combinations | Business Combinations Sustainable Growth Advisers, LP On July 1, 2018, the Company completed the acquisition of 70% of the outstanding limited partnership interests of SGA and 100% of the membership interests in its general partner, SGIA, LLC ("SGA Acquisition"). SGA is an investment manager specializing in U.S. and global growth equity portfolios. The SGA Acquisition expands Virtus' offerings of investment strategies from its affiliated managers and diversifies its client base, particularly among institutional investors and international clients. The total purchase price of the SGA Acquisition was $129.5 million, comprising (1) an initial payment of $110.5 million paid at closing, and (2) $19.0 million paid in August 2018 upon the successful completion of final closing conditions and client approvals. The Company accounted for the acquisition in accordance with ASC 805. The purchase price was allocated to the assets acquired, liabilities assumed and non-controlling interests based upon their estimated fair values at the date of the SGA Acquisition. Goodwill of $120.2 million and other intangible assets of $62.0 million were recorded as a result of the SGA Acquisition. The Company expects $127.5 million of this amount to be tax deductible over 15 years. The Company has not completed its final assessment of the fair values of purchased receivables or acquired contracts. The final fair value of the net assets acquired may result in adjustments to certain assets and liabilities, including goodwill. The following table summarizes the identified acquired assets, liabilities assumed and redeemable noncontrolling interests as of the acquisition date:
| July 1, 2018
($ in thousands) |
Assets: |
Cash and cash equivalents | $ | 2,505 |
Investments | 262 |
Accounts receivable | 6,649 |
Furniture, equipment and leasehold improvements | 70 |
Intangible assets | 62,000 |
Goodwill | 120,213 |
Other assets | 659 |
Total Assets | 192,358 |
Liabilities |
Accrued compensation and benefits | 824 |
Accounts payable and accrued liabilities | 6,534 |
Total liabilities | 7,358 |
Redeemable noncontrolling interests | 55,500 |
Total Net Assets Acquired | $ | 129,500 |
Identifiable Intangible Assets Acquired In connection with the allocation of the purchase price, the Company identified the following intangible assets:
| July 1, 2018
| Approximate Fair Value |  | Weighted Average of Useful Life
($ in thousands) |  |  |
Definite-lived intangible assets: |  |  |
Institutional and retail separate account investment contracts | $ | 49,000 |  |  | 6.0 years
Trade Name | 7,000 |  |  | 10.0 years
Non-Competition Agreements | 6,000 |  |  | 5.0 years
Total definite-lived intangible assets | $ | 62,000 |  |  |
The following unaudited pro forma condensed consolidated results of operations are provided for illustrative purposes only and assume that the SGA Acquisition occurred on January 1, 2017. The unaudited pro forma information also reflects adjustment for transaction and integration expenses as if the SGA Acquisition had been consummated on January 1, 2017. This unaudited information should not be relied upon as being indicative of historical results that would have been obtained if the SGA Acquisition had occurred on that date, nor of the results that may be obtained in the future.
| Three Months Ended |  | Nine Months Ended
| September 30, 2017 |  | September 30, 2018 |  | September 30, 2017 |  | September 30, 2018
($ in thousands, except per share amounts) |  |  |  |  |  |  |
Total Revenues | $ | 131,307 |  |  | $ | 152,210 |  |  | $ | 317,879 |  |  | $ | 431,400 |
Net Income (Loss) Attributable to Common Stockholders | $ | 16,493 |  |  | $ | 26,201 |  |  | $ | 22,897 |  |  | $ | 69,284 |
Basic EPS | $ | 2.29 |  |  | $ | 3.65 |  |  | $ | 3.30 |  |  | $ | 9.63 |
Diluted EPS | $ | 2.19 |  |  | $ | 3.35 |  |  | $ | 3.19 |  |  | $ | 8.93 |
RidgeWorth Investments On June 1, 2017, the Company acquired RidgeWorth Investments (the "RW Acquisition"), a multi-boutique asset manager with approximately $40.1 billion in assets under management, including $35.7 billion in long term assets under management and $4.4 billion in liquidity strategies. The total purchase price of the RW Acquisition was $547.1 million, comprising $485.2 million for the business and $61.9 million for certain balance sheet investments. The Company accounted for the RW Acquisition in accordance with ASC 805. The purchase price was allocated to the assets acquired and liabilities assumed based upon their estimated fair values at the date of the RW Acquisition. No incremental measurement period adjustments were recorded in the nine months ended September 30, 2018; the measurement period was complete on June 1, 2018. The following table summarizes the identified acquired assets and liabilities assumed as of the acquisition date:
| June 1, 2017
($ in thousands) |
Assets: |
Cash and cash equivalents | $ | 39,343 |
Investments | 5,516 |
Accounts receivable | 20,311 |
Assets of consolidated investment products ("CIP") |
Cash and cash equivalents of CIP | 38,261 |
Investments of CIP | 899,274 |
Other assets of CIP | 19,158 |
Furniture, equipment and leasehold improvements | 5,505 |
Intangible assets | 275,700 |
Goodwill | 163,365 |
Deferred taxes, net | 6,590 |
Other assets | 3,003 |
Total Assets | 1,476,026 |
Liabilities |
Accrued compensation and benefits | 18,263 |
Accounts payable and accrued liabilities | 11,858 |
Other liabilities | 2,601 |
Liabilities of consolidated investment products ("CIP") |
Notes payable of CIP | 770,160 |
Securities purchased payable and other liabilities of CIP | 109,881 |
Noncontrolling Interests of CIP | 16,181 |
Total Liabilities & Noncontrolling Interests | 928,944 |
Total Net Assets Acquired | $ | 547,082 |
The following unaudited pro forma condensed consolidated results of operations are provided for illustrative purposes only and assume that the RW Acquisition occurred on January 1, 2016. The unaudited pro forma information also reflects adjustment for transaction and integration expenses as if the RW Acquisition had been consummated on January 1, 2016. This unaudited information should not be relied upon as being indicative of historical results that would have been obtained if the RW Acquisition had occurred on that date, nor of the results that may be obtained in the future.
| Three Months Ended |  | Nine Months Ended
| September 30, 2017 |  | September 30, 2017
($ in thousands, except per share amounts) |  |  |
Total Revenues | $ | 118,010 |  |  | $ | 361,070 |
Net Income (Loss) Attributable to Common Stockholders | $ | 13,696 |  |  | $ | 29,975 |
Basic EPS | $ | 1.74 |  |  | $ | 3.42 |
Diluted EPS | $ | 1.70 |  |  | $ | 3.31 |
Identifiable Intangible Assets Acquired In connection with the allocation of the purchase price, the Company identified the following intangible assets:
| June 1, 2017
| Approximate Fair Value |  | Weighted Average of Useful Life
($ in thousands) |  |  |
Definite-lived intangible assets: |  |  |
Mutual fund investment contracts | $ | 189,200 |  |  | 16.0 years
Institutional and retail separate account investment contracts | 77,000 |  |  | 10.4 years
Trademarks/Trade names | 800 |  |  | 10.0 years
Total definite-lived intangible assets | 267,000 |  |  |
Indefinite-lived intangible assets: |  |  |
Trade names | 8,700 |  |  | N/A
Total identifiable intangible assets | $ | 275,700 |  |  |

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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- References No definition available. + Details
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