As described in Note 1. Business overview and basis of presentation, in January 2024, Informa TechTarget entered into the Transaction Agreement and closed the Merger on December 2, 2024. The acquisition positions the Company as a leading provider of data driven marketing analytics, sales enablement solutions, advisory services, and events for the enterprise technology and technology enabled vertical markets. It also provides the Company with greater product diversification through the addition of research brands which provide annual subscription revenue paid in advance as well as revenue from ad-hoc consulting projects.

In accordance with the Transaction Agreement, Informa TechTarget paid each Former TechTarget shareholder as consideration for one share of common stock of Former TechTarget (i) one share of Company common stock and (ii) cash consideration of approximately $11.70 per share of Former TechTarget common stock.


	TechTarget
Cash consideration(1)	$	348,971
Aggregate fair value of Informa TechTarget common stock issued for outstanding Former TechTarget common stock (2)		592,707
Replacement equity awards for Former TechTarget's equity awards(3)		9,771
Total consideration	$	951,449

(1)

Represents the total cash consideration paid to Former TechTarget stockholders.

(2)

Represents the aggregate fair value of 29,802,846 shares of Informa TechTarget’s common stock that were issued to Former TechTarget shareholders (including certain equity award holders) as purchase consideration as of the Acquisition Date pursuant to the Transaction Agreement. Informa TechTarget’s common stock did not have a readily observable market price at close. Accordingly, Informa TechTarget derived the per share fair value of Informa TechTarget’s stock based on the Former TechTarget’s quoted share price of $31.54 on Nasdaq at the close of trading on December 2, 2024 less the per share cash consideration of approximately $11.70. Informa TechTarget determined that the value of the cash consideration was already reflected in the quoted share price of Former TechTarget shares at close.

(3)

Represents consideration for replacement of Former TechTarget’s outstanding equity awards. In connection with the Merger, 949,300 Former TechTarget’s unvested restricted stock units (“RSUs”) were replaced by 1,492,858 Informa TechTarget’s RSUs with similar terms and conditions. The fair value of the RSU's was equal to the stock price of Former TechTarget's quoted share price of $31.54 on Nasdaq at the close of trading on December 2, 2024. The portion of the fair value of the replacement awards that will be recognized as compensation expense subsequent to the merger is $33.8 million.

The purchase price was allocated to the assets acquired and liabilities assumed based on the estimated fair values at the Acquisition Date. The excess of the purchase price over the fair value of the net assets acquired was allocated to goodwill, none of which is expected to be deductible for tax purposes. Goodwill is primarily attributed to synergies from future expected economic benefits, including expected revenue growth from expanded capabilities and geographic presence as well as cost savings from duplicative overhead and enhanced operational efficiency.


	TechTarget
Assets acquired
Cash and cash equivalents	$	276,656
Short-term investments		77,539
Accounts receivable		37,604
Prepaid taxes		3,130
Prepaid expenses and other current assets		5,475
Property and equipment		2,800
Intangible assets		575,000
Operating lease assets with right-of-use		12,268
Other assets		650
Total assets acquired	$	991,122

Liabilities assumed
Accounts payable	$	8,073
Convertible senior notes		413,570
Current operating lease liabilities		3,113
Accrued expenses and other current liabilities		18,633
Accrued compensation expenses		3,334
Income taxes payable		4,278
Current contract liabilities		16,411
Non-current operating lease liabilities		12,195
Deferred tax liabilities		124,398
Other liabilities		325
Total liabilities assumed	$	604,330
Total identifiable net assets acquired	$	386,792
Goodwill		564,657
Total consideration	$	951,449

The estimated fair value of accounts receivable is $37.6 million with gross contractual amount due being $39.5 million. Informa TechTarget estimates approximately $1.9 million to be uncollectable.

The fair values of the assets acquired and liabilities assumed were determined using the income, market and cost approaches, in addition to the Binomial Lattice model. The determination of fair values required estimates about discount rates, growth and attrition rates, future expected cash flows and other future events that are judgmental and subject to estimation uncertainty. Intangible assets consisting of customer relationships, developed technology and trade names were valued using the multi-period excess earnings method (“MEEM”), or the relief from royalty (“RFR”) method, both are forms of the income approach. A cost and market approach was applied, as appropriate, for property and equipment.

The following table reflects the allocation of the acquired intangible assets and related estimate of useful lives:


	Gross Carrying Amount		Useful Life
Customer relationships	$	395,000	17 years
Developed technology		115,000	7 years
Trade names		65,000	16 years
Total	$	575,000

Since the Acquisition Date, revenue and operating loss of Former TechTarget of $22.9 million and $9.7 million, respectively, have been included within the accompanying consolidated statement of income for the year ended December 31, 2024.

Informa TechTarget incurred transaction expenses of approximately $39.7 million for the year ended December 31, 2024 classified as acquisition costs under operating expenses within the accompanying consolidated statement of income (loss) and comprehensive income (loss).

Informa TechTarget recognized severance costs related to employee-related termination benefits as a result of the consolidation of certain roles within Informa TechTarget of $2.5 million for the year ended December 31, 2024, classified as acquisition and integration costs within the accompanying consolidated statement of income (loss) and comprehensive income (loss). Severance costs that have not been paid out as of December 31, 2024 of $0.5 million have been classified as accrued expenses and other current liabilities within the accompanying consolidated balance sheet.

The following unaudited supplemental pro forma consolidated financial information presents Informa TechTarget’s results of operations for the years ended December 31, 2024 and 2023 as if the acquisition of Former TechTarget had occurred on January 1, 2023. The pro forma financial information is presented for comparative purposes only and is not necessarily indicative of Informa TechTarget’s operating results that may have actually occurred had the acquisition of Former TechTarget been completed on January 1, 2023. In addition, the unaudited pro forma financial information does not give effect to any anticipated cost savings, operating efficiencies or other synergies that may be associated with the acquisition, or any estimated costs that have been or will be incurred by Informa TechTarget to integrate the assets and operations of Former TechTarget.


	Years Ended December 31,
	2024			2023
Revenue	$	490,391		$	482,063
Net loss	$	(165,996	)	$	(112,423	)

The unaudited pro forma financial information reflects pro forma adjustments to present the combined pro forma results of operations as if the acquisition had occurred on January 1, 2023 to give effect to certain events Informa TechTarget believes to be directly attributable to the acquisition. These pro forma adjustments primarily include:

On September 1, 2023, Informa TechTarget acquired 100% of the issued share capital of Canalys Pte Ltd and its subsidiaries (collectively “Canalys”). The acquisition expands Omdia research capabilities into Channel (distributors, value added resellers, systems integrators and managed service providers) and Mobility (consumer and business devices), while creating a global platform for networking in Channel by bringing together both Canalys and Informa TechTarget’s Channel events franchises.

Total consideration was $61.6 million, of which $52.6 million was settled in cash, $5.0 million in Informa common stock, and $4.0 million in contingent consideration. The contingent consideration was based on revenue and cost performance during the period from April 1, 2023 to March 31, 2024. The fair value of contingent consideration at acquisition was calculated using a probability-weighted scenario approach. Ongoing employment is not required to earn the contingent consideration, and as a result, the amount has been included in the total consideration transferred. The estimated range of undiscounted payment in respect of the contingent consideration was $0.6 million to $5.0 million. Subsequent remeasurement of the contingent consideration was recorded in the consolidated statements of income (loss) and comprehensive income (loss). See Note 4. Fair Value for the contingent consideration fair value at year end.

The following summarizes the fair value of the cash and contingent consideration transferred as part of the acquisition of Canalys:


	Canalys
Cash consideration	$	52,606
Capital consideration		5,000
Contingent consideration		3,980
Total consideration	$	61,586

The following table summarizes the fair value of the assets acquired and liabilities assumed for the Canalys acquisition:


	Canalys
Intangible assets	$	13,935
Accounts receivable		2,878
Prepaid expenses and other current assets		2,363
Cash and cash equivalents		4,776
Contract liabilities		(7,035	)
Deferred tax liabilities		(3,484	)
Other assets and liabilities, net		(1,621	)
Total identifiable net assets acquired	$	11,812
Goodwill		49,774
Total consideration	$	61,586

Intangible assets of $13.9 million consist of $10.1 million of customer relationships, valued using the excess earnings method, and $3.8 million of intellectual property valued using the relief from royalty method. A deferred tax liability has been recognized as a result of the recognition of these acquired intangible assets.

Goodwill arising from the acquisition was $49.8 million and represents the total consideration of $61.6 million less the fair value of the net assets acquired of $11.8 million.

The value of goodwill arising from the acquisition has been identified as relating to the following factors:

Acquisition costs of $1.0 million were recognized within acquisition and integration costs in the consolidated statements of income (loss) and comprehensive income (loss) in the year ended December 31, 2023.

Canalys generated revenue of $12.5 million and net income of $3.7 million for the period from the date of acquisition to December 31, 2023.

The following unaudited pro forma financial information for the periods below gives effect to the Canalys acquisition as if it had occurred as of January 1, 2022. The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved had the acquisition been consummated as of that time.


	Years Ended December 31,
	2023			2022
	As Restated			As Restated
Revenue	$	259,194		$	211,168
Net loss	$	(56,642	)	$	(6,032	)

Acquisition and integration costs were included in the year ended December 31, 2022 net loss reported above.

On September 1, 2022, Informa TechTarget acquired 100% of the issued share capital of Industry Dive. Industry Dive brings capabilities in audience development and lead generation through high quality specialist content and business journalism.

The cash consideration was $359.3 million with total consideration including two cash contingent consideration arrangements. The amount payable for the 2023 arrangement was determined by the revenue Industry Dive achieved in 2023. The 2023-2025 arrangement is payable based on Industry Dive’s revenue growth over a three-year period from 2023 to 2025. Informa TechTarget determined a fair value of $53.3 million and $109.8 million at the acquisition date for each of the arrangements respectively, bringing the total consideration to $522.4 million. There is no link between the contingent consideration and ongoing employment. The fair value of the contingent consideration for the Industry Dive acquisition was calculated using a Monte Carlo simulation approach. In determining the fair value, the contingent consideration on the Industry Dive acquisition was valued using a cost of debt rate of 5.4% and an average revenue discount rate of 7.3% as of December 31, 2023. Subsequent remeasurement of the contingent consideration is recorded in the consolidated statements of income (loss) and comprehensive income (loss). See Note 4. Fair value for the contingent consideration fair value at year end. The following summarizes the fair value of the cash and contingent consideration transferred as part of the acquisition of Industry Dive:


	Industry Dive
	As Restated
Cash consideration	$	359,287
Contingent consideration (2023 arrangement)		53,300
Contingent consideration (2023-2025 arrangement)		109,800
Total consideration	$	522,387


	Industry Dive
	As Restated
Acquired intangible assets	$	218,800
Other intangible assets		1,127
Operating lease right-of-use assets		4,636
Accounts receivable		15,722
Prepaid expenses and other current assets		1,961
Cash and cash equivalents		7,954
Deferred tax assets		3,650
Accrued expenses and other current liabilities		(7,119	)
Contract liabilities		(7,973	)
Accrued compensation expenses		(2,390	)
Other liabilities		(1,012	)
Long-term debt		(42,590	)
Operating lease liabilities		(4,636	)
Deferred tax liabilities, net		(57,024	)
Other assets and liabilities, net		(669	)
Total identifiable net assets acquired	$	130,437
Goodwill		391,950
Total consideration	$	522,387

Included in net assets acquired were $42.6 million of borrowings comprising of an interest-bearing loan. This loan was settled by the Parent on September 1, 2022, immediately following acquisition.

Intangible assets of $218.8 million consists of $133.0 million for customer relationships valued using the excess earnings income method, $75.0 million for trade names fair valued using the relief from royalty method and $10.8 million of intellectual property valued using the cost approach. A deferred tax liability was recognized as a result of the recognition of these acquired intangible assets.

Goodwill arising from the acquisition was $391.9 million, representing the total consideration of $522.4 million less the fair value of the net assets acquired of $130.4 million. The value of goodwill arising from the acquisition was identified as relating to the following factors:

Acquisition costs of $1.2 million and $7.7 million were recognized within acquisition and integration costs in the consolidated statements of income (loss) and comprehensive income (loss) in the years ended December 31, 2023 and 2022, respectively.

Industry Dive generated revenue of $33.8 million and net income of $7.5 million for the period from the date of acquisition to December 31, 2022.