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Business Combination | 12 Months Ended
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Dec. 31, 2017
Business Combination |
Business Combination | 3. Business Combination On July 1, 2017, the Company, through a wholly owned subsidiary ("2U South Africa"), completed its acquisition of all of the outstanding equity interests of GetSmarter pursuant to a Share Sale Agreement, dated as of May 1, 2017 (the "Share Sale Agreement"), as amended by an addendum, dated as of June 29, 2017, for a net purchase price of $98.7 million in cash. In addition, 2U South Africa agreed to pay a potential earn-out payment of up to $20.0 million, subject to the achievement of certain financial milestones in calendar years 2017 and 2018. Under the terms of the Share Sale Agreement, the Company has issued restricted stock units for shares of its common stock, par value $0.001 per share, to certain employees and officers of GetSmarter. These awards are subject to the 2014 2U, Inc. Equity Incentive Plan and will vest over either a two- or four-year period. As a result of the transaction, GetSmarter became an indirect wholly owned subsidiary of the Company. The net assets and results of operations of GetSmarter are included in the Company's consolidated financial statements and in the newly established Short Course Segment as of July 1, 2017. The Company has completed its valuation of the assets acquired and liabilities assumed of GetSmarter. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the date of the acquisition:
|  | Estimated Average Useful Life (in years) |  | Purchase Price Allocation |
|  |  |  | (in thousands) |
Cash and cash equivalents |  |  |  | $ | 1,584 |
Current assets |  |  |  |  | 3,676 |
Property and equipment, net |  |  |  |  | 479 |
Amortizable intangible assets: |  |  |  |  |  |
Capitalized technology |  | 3 |  |  | 2,800 |
Capitalized content development |  | 4 |  |  | 5,000 |
University client relationships |  | 9 |  |  | 28,000 |
Trade names and domain names |  | 10 |  |  | 8,900 |
Goodwill |  |  |  |  | 68,172 |
Current liabilities |  |  |  |  | (9,031 | )
Non-current liabilities |  |  |  |  | (10,894 | )
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|  |  |  | $ | 98,686 |
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As of December 31, 2017, the completion of the purchase price allocation resulted primarily in a decrease of approximately $2 million in goodwill and an offsetting decrease in other current liabilities related to contingent consideration. While the overall value of acquired intangible assets did not materially change, their individual values were reallocated between the asset categories. The goodwill balance is primarily attributed to the assembled workforce, expanded market opportunities and cost and other operating synergies anticipated upon the integration of the operations of 2U and GetSmarter. The goodwill resulting from the acquisition is not expected to be tax deductible. The unaudited pro forma combined financial information below is presented for illustrative purposes and does not purport to represent what the results of operations would actually have been if the business combination occurred as of the dates indicated or what the results would be for any future periods. The following table presents the Company's unaudited pro forma combined revenue and pro forma combined net loss, for the years ended December 31, 2017 and 2016 as if the acquisition of GetSmarter had occurred on January 1, 2016:
|  | Year Ended December 31, |
|  | 2017 |  | 2016 |
|  | (in thousands) |
Pro forma revenue |  | $ | 294,446 |  | $ | 223,532 |
Pro forma net loss |  |  | (37,267 | ) |  | (27,959 | )
Pro forma net loss per share, basic and diluted |  | $ | (0.76 | ) | $ | (0.60 | )

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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://www.xbrl.org/2003/role/presentationRef -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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