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Acquisitions and Disposals | 12 Months Ended
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Mar. 31, 2015
Business Combinations [Abstract] |
Acquisitions and Disposals |
3. | Acquisitions and Disposals
Mirror Image Access On April 12, 2013, Digital Turbine acquired all of the issued and outstanding stock of Mirror Image Australia Holdings, which directly or indirectly owns subsidiaries Mirror Image Access (Australia) Pty Ltd, MIA Technology Australia Pty Ltd and MIA Technology IP Pty Ltd. The purpose of the acquisition was an effort not only to build on the Company’s current distribution network, but to enhance its mobile content infrastructure with the intellectual property acquired in the purchase. The acquisition of was capitalized through a combination of intercompany debt and the issuance of equity. The purchase consideration for the transaction was comprised of cash, a note, and common stock of the Company, as follows: (1) At closing AUD 1,220 in cash, translated to $1,287 for U.S. GAAP reporting purposes; (2) Convertible Note payable of AUD 2,280, translated to $2,404; (3) Shares of common stock of the Company (the “Closing Shares”) equivalent to AUD 3,500, translated to $3,691 and under the agreement, converted to shares at $3.65 per share, or 1,011,164 shares of the common stock of the Company. The closing price of the stock on that day was $4.40 per share, for a total value of $4,449. The Closing Shares are subject to a Registration Rights Agreement that provides for piggyback rights for 3 years and were included on the Company’s Form S-3 filed August 30, 2013, and subsequently made effective on October 31, 2013. The following table summarizes the final fair values of the assets acquired and liabilities assumed at the date of acquisition.
Cash | $ | 513 |
Accounts receivable |  | 2,809 |
Prepaid expenses and other assets |  | 896 |
Property, plant and equipment |  | 300 |
Customer relationships |  | 1,600 |
Developed technology |  | 3,400 |
Trade names / trademarks |  | 54 |
Library |  | 300 |
Goodwill |  | 2,654 |
Accounts payable |  | (1,151 | )
Accrued liabilities |  | (2,890 | )
Accrued compensation |  | (345 | )
Purchase price | $ | 8,140 |
In addition to the value assigned to the acquired workforce, the Company recorded the excess of the purchase price over the estimated fair value of the assets acquired as an increase in goodwill. This goodwill arises because the purchase price reflects the strategic fit and resulting synergies that the acquired business brings to the Company’s existing operations. In the fiscal year ended March 31, 2014, the Company recorded an impairment charge of $54 to write down trade names pursuant to its decision to rename and rebrand trade names associated with Logia and MIA. In the period ended June 30, 2014, the Company finalized the purchase price allocation which resulted in an adjustment from intangibles to goodwill of $1,472. The amortization period for the intangible assets acquired in the MIA transaction is as follows:
| Remaining
| Useful Life
Customer relationships | 14
Developed technology | 5
Trade names / trademarks | 5
Library | 5
Goodwill | Indefinite
Xyologic Mobile Analysis On October 9, 2014, the Company acquired certain intellectual property assets of Xyologic Mobile Analysis, GmbH ("XYO"), related to mobile application (“app”) recommendation, search and discovery. The Company is in the process of integrating the acquired technology into the DT IQ software solution. The acquisition was effected pursuant to an Asset Purchase Agreement dated October 8, 2014 (the “Asset Purchase Agreement”). The aggregate purchase price was US $2,500, paid in cash, subject to a twelve (12) month holdback of US $375, which acts as partial security for potential future indemnification claims. The purchase price fair values have been allocated to goodwill of $1,000 and developed technology of $1,500. The Company finalized the purchase price allocation in the period ended March 31, 2015. DT Media (Appia) On March 6, 2015, the Company completed the merger of Appia, Inc. (“Appia”) into its wholly owned subsidiary, DTM Merger Sub, Inc. The surviving entity was renamed Digital Turbine Media, Inc. (“DT Media”). Under the Merger Agreement, the Company is to issue shares of its common stock in exchange for all of Appia’s outstanding common and preferred stock and warrants. The number of shares that were issued by the Company is subject to adjustment based on Appia’s working capital and net indebtedness as of the closing date of the merger. Based on Appia’s working capital and net indebtedness as of March 6, 2015, the Company issued 18,883,723 shares of its common stock and reserved 245,955 of its common stock for Appia’s equity awards outstanding at the closing date that are assumed by the Company and converted into equity awards for Digital Turbine common stock. Vested equity awards held by Appia’s employees and service providers are considered part of the purchase price; accordingly, the estimated purchase price includes an estimated fair value of equity awards to be issued by the Company of approximately $633. The value of the Company’s common stock used to estimate the purchase price was $3.94 per share, the closing price on March 6, 2015. The following table summarizes the preliminary fair values of the assets acquired and liabilities assumed at the date of acquisition, based on information available as of March 31, 2015. These preliminary fair values differ from the estimated fair values reflected in the pro forma financial information included in the Company’s previously filed S-4 to the availability of additional and updated information. The following table summarizes the preliminary fair values of the assets acquired and liabilities assumed at the date of acquisition.
Cash | $ | 1,363 |
Accounts receivable |  | 7,364 |
Prepaid expenses and other assets |  | 171 |
Property, plant and equipment |  | 229 |
Developed technology |  | 7,700 |
Advertiser relationships |  | 6,500 |
Publisher relationships |  | 3,200 |
Trade names / trademarks |  | 380 |
Goodwill |  | 69,438 |
Accounts payable |  | (5,179 | )
Accrued expenses |  | (4,531 | )
Debt |  | (11,600 | )
Purchase price | $ | 75,035 |
The amortization period for the intangible assets acquired in the DT Media, Inc. transaction is as follows:
| Remaining
| Useful Life
Developed technology | 4 years
Trade names / Trademarks | 2 years
Publisher relationships | 2 years
Advertiser relationships | 2 years
Goodwill | Indefinite
The pro forma financial information of the Company’s consolidated operations if the acquisition of DT Media, Inc. had occurred as of April 1, 2013 is presented below.
| Unaudited |
| Twelve Months Ended |
| March 31, |
| 2015 |  |  | 2014 |
Revenues | $ | 57,978 |  |  | $ | 73,533 |
Cost of goods sold |  | 45,580 |  |  |  | 52,638 |
Gross profit |  | 12,398 |  |  |  | 20,895 |
Operating expenses |  | 43,644 |  |  |  | 37,072 |
Loss from operations |  | 31,247 |  |  |  | 16,177 |
Non-operating expense |  | 3,372 |  |  |  | 1,950 |
Provision for income taxes |  | 541 |  |  |  | 864 |
Net loss | $ | 35,160 |  |  | $ | 18,991 |
Basic and diluted loss per share | $ | 0.90 |  |  | $ | 0.49 |
The operating results of DT Media, Inc. are included in the accompanying consolidated statements of operations from the acquisition date. The combined consolidated operating results from the acquisition date to March 31, 2015 are as follows:
| Unaudited |
Revenues | $ | 3,251 |
Cost of goods sold |  | 3,227 |
Gross profit |  | 24 |
Operating expenses |  | 1,194 |
Loss from operations |  | 1,170 |
Non-operating expense |  | 113 |
Provision for income taxes |  | - |
Net loss | $ | 1,283 |

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References No definition available. + Details
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