Divestitures Divestitures (Notes) |
9 Months Ended |
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Sep. 30, 2016 | |
| Disposal Group, Not Discontinued Operation, Disposal Disclosures [Abstract] | |
| Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] |
DIVESTITURES
On September 8, 2016, HSNi completed the sale of substantially all of the assets and certain liabilities of Chasing Fireflies and TravelSmith, two of the apparel brands included within the Cornerstone segment. The sale price included $1 million in cash and $2 million of contingent consideration that is based on the achievement of certain performance metrics in 2016. As of September 30, 2016, HSNi assigned no value to the contingent consideration as it was not considered probable of being earned. During the third quarter of 2016, Cornerstone recorded a pre-tax loss on sale of $11.2 million. The transaction included cash charges of approximately $3.8 million related to transactions costs and employee and lease liabilities. As of September 30, 2016, there was approximately $1.8 million in exit-related liabilities that were included in "Accrued expenses and other current liabilities" in the accompanying balance sheet.
The assets and liabilities of the two brands were classified as held for sale as of June 30, 2016 which resulted in a non-cash asset impairment charge of $20.4 million recorded in the second quarter of 2016.
The loss on sale and asset impairment charges related to this sale are recorded in the consolidated statements of operations in the line item “Loss on sale and asset impairment.” The assets sold were largely represented by $29.3 million of inventory and $8.4 million of other assets, and approximately $8.6 million of current liabilities.
HSNi determined the sale of these businesses would not represent a strategic shift in its business nor will it have a major effect on its consolidated results of operations, financial position or cash flows. Accordingly, the disposal group is not presented in the consolidated financial statements as a discontinued operation.
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