HP 2011 Annual Report Download - page 107

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 6: Acquisitions (Continued)
The following table presents the aggregate estimated fair values of the assets acquired and
liabilities assumed, including those items that are still preliminary allocations, for all of HP’s
acquisitions in fiscal 2011:
In millions
In-process research and development ........................................ $ 3
Amortizable intangible assets .............................................. 4,699
Net liabilities assumed ................................................... (206)
Net assets acquired ..................................................... 4,496
Goodwill ............................................................. 6,868
Total fair value consideration .............................................. $11,364
Acquisition of Autonomy Corporation plc
HP’s largest acquisition in fiscal 2011 was its acquisition of Autonomy Corporation plc
(‘‘Autonomy’’). As of October 31, 2011, HP owned an approximately 99% equity interest in Autonomy,
and HP expects to acquire a 100% equity interest before the end of the first quarter of fiscal 2012.
Autonomy is a provider of infrastructure software for the enterprise. HP reports the financial results of
the Autonomy business in the HP Software segment. The acquisition date fair value consideration of
$11 billion consisted of cash paid for outstanding common stock, convertible bonds, vested
in-the-money stock awards and the estimated fair value of earned unvested stock awards assumed by
HP. In connection with this acquisition, HP recorded approximately $6.6 billion of goodwill and
amortizable purchased intangible assets of $4.6 billion. HP is amortizing the purchased intangible assets
on a straight-line basis over an estimated weighted-average life of 8.8 years.
Acquisitions in prior years
In fiscal 2010, HP completed eleven acquisitions. Total fair value of purchase consideration for the
acquisitions was $9.4 billion, which includes cash paid for common stock, vested-in-the-money stock
awards, the estimated fair value of earned unvested stock awards assumed, as well as certain debt that
was repaid at the acquisition date. In connection with these acquisitions, HP recorded approximately
$5.2 billion of goodwill, $2.4 billion of purchased intangibles and $331 million of IPR&D. The largest
four of the eleven acquisitions were the acquisitions of 3Com Corporation (‘‘3Com’’), Palm, Inc.
(‘‘Palm’’), 3PAR Inc. (‘‘3PAR’’) and ArcSight, Inc. (‘‘ArcSight’’).
In fiscal 2009, HP completed two acquisitions. Total fair value of purchase consideration for the
acquisitions was $390 million, which includes direct transaction costs and the assumption of certain
liabilities in connection with the transactions. In connection with these transactions, HP recorded
$315 million of goodwill, $105 million of purchased intangibles and $7 million of IPR&D. The larger of
the two acquisitions was the acquisition of Lefthand Networks, Inc.
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