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Acquisition of Businesses | 12 Months Ended
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Dec. 31, 2018
Business Combinations [Abstract] |
Acquisition of Businesses | Note 4. Acquisition of Businesses 2018 Acquisition Maligne Canyon Restaurant In March 2018, we acquired the Maligne Canyon Restaurant and Gift Shop for total cash consideration of $6.0 million Canadian dollars (approximately $4.6 million U.S. dollars). Transaction costs associated with the acquisition were $24 thousand in 2018, which are included in “Cost of services” in the Consolidated Statements of Operations. These assets have been included in the consolidated financial statements from the date of acquisition. 2017 Acquisitions Poken In March 2017, we acquired Poken event engagement technology for total cash consideration of $1.7 million. Transaction costs associated with the acquisition of Poken were $0.3 million in 2017, which are included in “Cost of services” in the Consolidated Statements of Operations. These assets have been included in the consolidated financial statements from the date of acquisition. Esja On November 3, 2017, we acquired the controlling interest (54.5% of the common stock) in Esja, a private corporation in Reykjavik, Iceland. Through Esja, we are developing and will operate a new FlyOver Iceland attraction, which is scheduled to open in July 2019. The purchase price was €8.2 million (approximately $9.5 million) in cash, and the shareholders agreement includes a put option that gives the minority Esja shareholders the right to sell (or “put”) their Esja shares to us based on a calculated formula within a predefined term. The noncontrolling interest’s carrying value is determined by the fair value of the noncontrolling interest as of the acquisition date, the noncontrolling interest’s share of the subsequent net income or loss, and the accretion of the redemption value of the put option. As of the transaction date, the fair value of the noncontrolling interest was estimated to be $6.7 million. The fair value of the noncontrolling interest was finalized as of March 31, 2018. During 2018, we made a purchase price allocation adjustment to goodwill of $0.1 million. Refer to Note 9 – Goodwill and Other Intangible Assets and Note 22 – Redeemable Noncontrolling Interest for additional information. Under the acquisition method of accounting, the purchase price is allocated to the assets acquired and liabilities assumed based on their estimated fair values. The excess purchase price over the fair value of net assets acquired is recorded as goodwill. Goodwill is included in the Pursuit business group and the primary factor that contributed to the purchase price resulting in the recognition of goodwill relates to future expected income from operations after opening in 2019. Goodwill is deductible for tax purposes. Transaction costs associated with the Esja acquisition were $0.1 million in each 2018 and 2017, which are included in “Corporate activities” in the Consolidated Statements of Operations. The Esja results of operations have been included in the consolidated financial statements from the date of acquisition. Esja had operating losses, representing start-up costs, of $0.9 million during 2018 and $0.1 million during 2017. 2016 Acquisitions Maligne Lake Tours On January 4, 2016, we acquired the assets and operations of Maligne Tours Ltd. (“Maligne Lake Tours”), which provides interpretive boat tours and related services at Maligne Lake, the largest lake in Jasper National Park. The purchase price was $20.9 million Canadian dollars (approximately $15.0 million U.S. dollars) in cash. Transaction costs associated with the Maligne Lake Tours acquisition were $0.1 million in each 2016 and 2017, which are included in “Cost of services” in the Consolidated Statements of Operations and $0.2 million in 2015, which are included in corporate activities in the Consolidated Statements of Operations. The results of operations of Maligne Lake Tours have been included in the consolidated financial statements from the date of acquisition. CATC On March 11, 2016, we acquired 100% of the equity interests in CATC Alaska Tourism Corporation (“CATC”), the operator of an Alaskan tourism business that includes a marine sightseeing tour business, three lodges, and a package tour business. The purchase price was $45.0 million in cash. Transaction costs associated with the CATC acquisition were $0.1 million in 2017, $0.1 million in 2016, and $0.6 million in 2015, which are included in “Corporate activities” in the Consolidated Statements of Operations. The results of operations of CATC have been included in the consolidated financial statements from the date of acquisition. ON Services On August 11, 2016, we acquired the assets and operations of ON Event Services, LLC (“ON Services”), a leading provider of audio-visual production services for live events in the United States. The aggregate purchase price was up to $92.5 million in cash, which included an earnout payment (the “Earnout”) of up to $5.5 million. The fair value of the Earnout was valued on the date of acquisition and was remeasured based on the financial performance of ON Services for 2016. As of the transaction date, the fair value of the Earnout was estimated to be $540,000. As of December 31, 2016, we determined the fair value of the Earnout was zero as ON Services did not meet its 2016 financial target. Transaction costs associated with the ON Services acquisition were $0.1 million in 2017 and $0.9 million in 2016, which are included in “Corporate activities” in the Consolidated Statement of Operations. The results of operations of ON Services have been included in the consolidated financial statements from the date of acquisition. FlyOver Canada On December 29, 2016, we acquired the assets and operations of FlyOver Canada, a recreational attraction that provides a virtual flight ride experience with a combination of motion seating, spectacular media, and visual effects including wind, scents, and mist. The purchase price was $68.8 million Canadian dollars (approximately $50.9 million U.S. dollars) in cash. Transaction costs associated with the FlyOver Canada acquisition were $0.1 million in 2017 and $0.5 million in 2016, which are included in “Cost of services” in the Consolidated Statements of Operations. The results of operations of FlyOver Canada have been included in the consolidated financial statements from the date of acquisition. The following table summarizes the final allocation of the aggregate purchase price paid and amounts of assets acquired and liabilities assumed based upon the estimated fair value at the dates of acquisitions. The balances in the table below remain unchanged from the balances reflected in the Consolidated Balance Sheets in our Annual Report on Form 10-K for the year ended December 31, 2017.
|  | Maligne Lake Tours |  |  | CATC |  |  | ON Services |  |  | FlyOver Canada |
(in thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Purchase price paid as: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash |  | $ | 14,962 |  |  | $ | 45,000 |  |  | $ | 87,000 |  |  | $ | 50,920 |
Working capital adjustment |  |  | — |  |  |  | (35 | ) |  |  | 344 |  |  |  | — |
Contingent consideration |  |  | — |  |  |  | — |  |  |  | 540 |  |  |  | — |
Cash acquired |  |  | — |  |  |  | (2,196 | ) |  |  | — |  |  |  | (6 | )
Total purchase price, net of cash acquired |  |  | 14,962 |  |  |  | 42,769 |  |  |  | 87,884 |  |  |  | 50,914 |
Fair value of net assets acquired: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Accounts receivable |  |  | — |  |  |  | 8 |  |  |  | 4,643 |  |  |  | — |
Inventories |  |  | 246 |  |  |  | 921 |  |  |  | 256 |  |  |  | 11 |
Prepaid expenses |  |  | 2 |  |  |  | 82 |  |  |  | 872 |  |  |  | 37 |
Property and equipment |  |  | 4,133 |  |  |  | 43,470 |  |  |  | 14,827 |  |  |  | 10,867 |
Intangible assets |  |  | 9,244 |  |  |  | 980 |  |  |  | 33,990 |  |  |  | 6,028 |
Total assets acquired |  |  | 13,625 |  |  |  | 45,461 |  |  |  | 54,588 |  |  |  | 16,943 |
Accounts payable |  |  | — |  |  |  | 306 |  |  |  | 992 |  |  |  | — |
Accrued liabilities |  |  | — |  |  |  | 434 |  |  |  | 564 |  |  |  | 118 |
Customer deposits |  |  | 15 |  |  |  | 1,952 |  |  |  | 851 |  |  |  | — |
Other liabilities |  |  | 240 |  |  |  | — |  |  |  | 274 |  |  |  | — |
Total liabilities acquired |  |  | 255 |  |  |  | 2,692 |  |  |  | 2,681 |  |  |  | 118 |
Total fair value of net assets acquired |  |  | 13,370 |  |  |  | 42,769 |  |  |  | 51,907 |  |  |  | 16,825 |
Excess purchase price over fair value of net assets acquired (“goodwill”) |  | $ | 1,592 |  |  | $ | — |  |  | $ | 35,977 |  |  | $ | 34,089 |
Under the acquisition method of accounting, the purchase prices as shown in the table above are allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values. The excess purchase price over fair value of net assets acquired is recorded as “Goodwill”. Goodwill is included in the Pursuit business group for Maligne Lake Tours and FlyOver Canada and in the GES business group for ON Services. The primary factor that contributed to the purchase price resulting in the recognition of goodwill relates to future growth opportunities, and the expansion of the FlyOver concept for FlyOver Canada, when combined with our other businesses. All goodwill is deductible for tax purposes pursuant to Canadian tax regulations for Maligne Lake Tours and FlyOver Canada and over a period of 15 years for ON Services. The estimated values of current assets and liabilities were based upon their historical costs on the date of acquisition due to their short-term nature. Following are the details of the purchase price allocated to the intangible assets acquired for the 2016 Acquisitions:
(in thousands, except weighted average life) |  | Maligne Lake Tours |  |  | CATC |  |  | ON Services |  |  | FlyOver Canada |
Customer relationships |  | $ | 788 |  |  | $ | 780 |  |  | $ | 27,620 |  |  | $ | 1,592 |
Operating licenses |  |  | 8,313 |  |  |  | — |  |  |  | — |  |  |  | — |
Trade name |  |  | 143 |  |  |  | 200 |  |  |  | 3,190 |  |  |  | 3,710 |
Non-compete agreements |  |  | — |  |  |  | — |  |  |  | 3,180 |  |  |  | 726 |
Fair value of intangible assets acquired |  | $ | 9,244 |  |  | $ | 980 |  |  | $ | 33,990 |  |  | $ | 6,028 |
Weighted average life |  | 26.7 years(1) |  |  | 5.8 years |  |  | 10.5 years |  |  | 9.4 years |
(1) | Largely attributable to operating licenses amortized over the remaining Parks Canada lease of 29 years.

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