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Acquisition of QCII by CenturyLink
 12 Months Ended
Dec. 31, 2013
Business Combinations [Abstract]  
Acquisition of QCII by CenturyLink
Acquisition of QCII by CenturyLink
On April 1, 2011, our indirect parent QCII became a wholly owned subsidiary of CenturyLink.
Since April 1, 2011, our consolidated results of operations have been included in the consolidated results of operations of CenturyLink. CenturyLink has accounted for its acquisition of QCII and us under the acquisition method of accounting, which resulted in the assignment of the purchase price to the assets acquired and liabilities assumed based on their acquisition date fair values. In the first quarter of 2012, we completed our valuation of the assets acquired and liabilities assumed, along with the related allocations to goodwill and intangible assets.
The aggregate consideration exceeded the aggregate estimated fair value of the assets acquired and liabilities assumed by $9.354 billion, which we recognized as goodwill. This goodwill is attributable to strategic benefits, including enhanced financial and operational scale, product and market diversification and leveraged combined networks that we expect to realize. None of the goodwill associated with this acquisition is deductible for income tax purposes.
The following was our assignment of the aggregate consideration:
 
April 1, 2011
 
(Dollars in millions)
Cash, accounts receivable and other current assets*
$
1,108

Property, plant and equipment
7,460

Identifiable intangible assets:
 
Customer relationships
5,699

Capitalized software
1,702

Other noncurrent assets
209

Current liabilities, excluding current maturities of long-term debt
(2,446
)
Current maturities of long-term debt
(2,378
)
Long-term debt
(6,310
)
Deferred credits and other liabilities
(4,447
)
Goodwill
9,354

Aggregate consideration
$
9,951

_______________________________________________________________________________
*
Includes estimated fair value of $674 million for accounts receivable, excluding affiliate accounts receivable, which had gross contractual value of $722 million on April 1, 2011. The $48 million difference between the gross contractual value and the estimated fair value assigned represents our best estimate as of April 1, 2011 of contractual cash flows that would not be collected.
Acquisition-Related Expenses
We have incurred operating expenses related to CenturyLink's indirect acquisition of us, which consist primarily of integration and severance expenses. The table below summarizes our acquisition-related expenses:
 
Successor
 
 
Predecessor
 
Combined
 
Year 
 Ended 
 December 31, 
 2013
 
Year 
 Ended 
 December 31, 
 2012
 
Nine Months 
 Ended 
 December 31,  
 2011
 
 
Three Months  
 Ended  
 March 31,  
 2011
 
Twelve Months
Ended
December 31,
2011
 
(Dollars in millions)
Acquisition-related expenses
$
24

 
39

 
146

 
 
2

 
148


The total amounts of these expenses are recognized in our cost of services and products and selling, general and administrative expenses.