Liberty Broadband Corporation Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Acquisition (Tables)

Acquisition (Tables)

12 Months Ended

Dec. 31, 2021

The following details the acquisition consideration as of December 18, 2020 (amounts in millions), which is primarily based on level 1 inputs:


Fair value of newly issued Liberty Broadband Series C and B common stock ¹	$	9,695
Fair value of newly issued Liberty Broadband Preferred Stock ²		203
Fair value of share-based payment replacement awards ³		105
Total fair value of consideration		10,003
Less: Fair value of Liberty Broadband shares attributable to share repurchase ⁴		(6,739)
Total fair value of consideration attributable to business combination		3,264
Less: Fair value of newly issued Liberty Broadband Preferred Stock²		(203)
Less: Fair value of share-based payment replacement awards accounted for as liability awards		(1)
Total fair value of acquisition consideration to be allocated	$	3,060

(1)

The fair value of newly issued Series C and B Liberty Broadband common stock was calculated by multiplying (i) the outstanding shares of GCI Liberty Series A and B common stock as of December 18, 2020 (ii) the exchange ratio of 0.58, and (iii) the closing share price of Liberty Broadband Series C and B common stock on December 18, 2020. Liberty Broadband issued 61.3 million shares of Series C common stock and 98 thousand shares of Series B common stock.

(2)

The fair value of the newly issued Liberty Broadband Preferred Stock was calculated by multiplying (i) the outstanding shares of GCI Liberty Preferred Stock as of December 18, 2020, and (ii) the closing share price of GCI Liberty Preferred Stock on December 18, 2020. The GCI Liberty Preferred Stock was converted on a one to one ratio into Liberty Broadband Preferred Stock.

(3)

This amount represents the fair value of share-based payment replacement awards.

(4)

GCI Liberty owned approximately 42.7 million shares of Liberty Broadband Series C common stock. The acquisition of Liberty Broadband Series C common stock is accounted for as a share repurchase by Liberty Broadband. This amount was calculated by multiplying (i) the number of shares of Liberty Broadband Series C common stock owned by GCI Liberty as of December 18, 2020 and (ii) the closing share price of Liberty Broadband Series C common stock on December 18, 2020.

Preliminary acquisition price allocation

The acquisition purchase price allocation for GCI Liberty is as follows (amounts in millions):


Cash and cash equivalents including restricted cash	$	592
Receivables		339
Property and equipment		1,109
Goodwill		755
Investment in Charter		3,494
Intangible assets not subject to amortization		587
Intangible assets subject to amortization		639
Other assets		302
Deferred revenue		(60)
Debt, including obligations under tower and finance leases		(2,772)
Indemnification liability		(336)
Deferred income tax liabilities		(1,026)
Preferred stock		(203)
Non-controlling interest		(12)
Other liabilities		(348)
Total fair value of acquisition consideration to be allocated	$	3,060

Pro forma revenue and net earnings


	Years ended December 31,
	2020		2019

	amounts in millions, except
	per share amounts
Revenue	$	968	903
Net earnings (loss)	$	695	(172)
Net earnings (loss) attributable to Liberty Broadband shareholders	$	695	(171)
Basic net earnings (loss) attributable to Series A, Series B and Series C Liberty Broadband shareholders per common share	$	3.82	(0.86)
Diluted net earnings (loss) attributable to Series A, Series B and Series C Liberty Broadband shareholders per common share	$	3.79	(0.86)