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Discontinued Operations | 6 Months Ended
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Jun. 30, 2021
Discontinued Operations and Disposal Groups [Abstract] |
Discontinued Operations | Discontinued Operations On August 26, 2020, Sprint Corporation ("Sprint"), an indirect subsidiary of T-Mobile US, Inc., ("T-Mobile"), on behalf of and as the direct or indirect owner of Sprint PCS, delivered notice to the Company exercising its option to purchase the assets and operations of our Wireless operations for 90% of the “Entire Business Value” (as defined under our affiliate agreement and determined pursuant to the appraisal process set forth therein). Shortly thereafter, the Company committed to a plan to sell the discontinued Wireless operations. On July 1, 2021, pursuant to the previously announced Asset Purchase Agreement (the “Purchase Agreement”), dated May 28, 2021, between Shentel and T-Mobile, Shentel completed the sale to T-Mobile of its Wireless assets and operations for cash consideration of approximately $1.94 billion, inclusive of the approximately $60 million settlement of the waived management fees by Sprint, and net of certain transaction expenses (the “Transaction”). The Company’s Wireless assets and operations were classified as discontinued operations after Sprint delivered notice to the Company exercising its option to purchase the Wireless assets and operations on August 26, 2020. The assets and liabilities that transferred in the sale were presented as held for sale within our unaudited condensed consolidated balance sheets, and discontinued operations within our unaudited condensed consolidated statements of comprehensive income. This disposal group excludes the accounts receivable and certain current liabilities generated by our Wireless operations because they are expected to be settled separately from the sale. Such accounts receivable totaled $49.1 million and $51.7 million at June 30, 2021 and December 31, 2020, respectively, and such current liabilities totaled $8.0 million and $6.1 million at June 30, 2021 and December 31, 2020, respectively. The transaction is structured as an asset sale for income tax purposes. As a result, no current or deferred tax assets or liabilities are included within the disposal group. While our long-term debt does not transfer in the sale, its provisions required us to repay all of the debt upon consummation of the sale. Our debt is therefore presented outside of the disposal group as a current liability. Our related interest rate swap liabilities are also presented outside of the disposal group as a current liability, because management terminated them at consummation. Because repayment of the debt is contractually triggered by the sale, the related interest expense is presented within discontinued operations under the relevant authoritative guidance. The carrying amounts of the major classes of assets and liabilities, which are classified as held for sale in the consolidated balance sheets, are as follows:
(in thousands) | June 30, 2021 |  | December 31, 2020
ASSETS |  |  |
Inventory | $ | 1,823 |  |  | $ | 5,746 |
Prepaid expenses and other | 42,562 |  |  | 47,003 |
Property, plant and equipment, net | 298,471 |  |  | 299,647 |
Intangible assets, net | 155,748 |  |  | 176,459 |
Goodwill | 146,383 |  |  | 146,383 |
Operating lease right-of-use assets | 417,754 |  |  | 421,586 |
Deferred charges and other assets | 38,452 |  |  | 36,470 |
Current assets held for sale | $ | 1,101,193 |  |  | $ | 1,133,294 |
LIABILITIES |  |  |
Current operating lease liabilities | $ | 383,633 |  |  | $ | 409,887 |
Accrued liabilities and other | 5,202 |  |  | 8,770 |
Asset retirement obligations | 34,173 |  |  | 33,545 |
Current liabilities held for sale | $ | 423,008 |  |  | $ | 452,202 |
Income from discontinued operations, net of tax in the consolidated statements of comprehensive income consist of the following:
(in thousands) | Three Months Ended June 30, |  | Six Months Ended June 30,
Revenue: | 2021 |  | 2020 |  | 2021 |  | 2020
Service revenue and other | $ | 100,402 |  |  | $ | 110,138 |  |  | $ | 201,076 |  |  | $ | 201,526 |
Equipment revenue | 5,854 |  |  | 9,610 |  |  | 12,253 |  |  | 22,360 |
Total revenue | 106,256 |  |  | 119,748 |  |  | 213,329 |  |  | 223,886 |
Operating expenses: |  |  |  |  |  |  |
Cost of services | 18,717 |  |  | 33,192 |  |  | 38,144 |  |  | 66,631 |
Cost of goods sold | 5,743 |  |  | 9,437 |  |  | 11,964 |  |  | 21,965 |
Selling, general and administrative | 6,812 |  |  | 9,348 |  |  | 17,514 |  |  | 18,278 |
Restructuring expense | 254 |  |  | — |  |  | 465 |  |  | — |
Depreciation and amortization | — |  |  | 22,901 |  |  | — |  |  | 47,727 |
Total operating expenses | 31,526 |  |  | 74,878 |  |  | 68,087 |  |  | 154,601 |
Operating income | 74,730 |  |  | 44,870 |  |  | 145,242 |  |  | 69,285 |
Other (expense) income: |  |  |  |  |  |  |
Interest expense | (4,317) |  |  | (4,742) |  |  | (8,701) |  |  | (10,970) |
Income before income taxes | 70,413 |  |  | 40,128 |  |  | 136,541 |  |  | 58,315 |
Income tax expense | 18,847 |  |  | 10,345 |  |  | 36,503 |  |  | 15,402 |
Income from discontinued operations, net of tax | $ | 51,566 |  |  | $ | 29,783 |  |  | $ | 100,038 |  |  | $ | 42,913 |
Under the relevant authoritative guidance, consummation of the sale will trigger or accelerate the recognition of certain expense related to contingent deal advisory fees, severance costs, recognition of our interest rate swap losses in net income, and loss on debt extinguishment. We estimate these expenses to be approximately $34 million.

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- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 + Details
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