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Acquisitions and Divestitures | 9 Months Ended
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Feb. 28, 2021
Business Combinations [Abstract] |
Acquisitions and Divestitures |
NOTE 13 — ACQUISITIONS AND DIVESTITURES
During the third quarter of fiscal 2020, as a result of the Company's decision to transition its wholesale and direct to consumer operating model in certain countries within its APLA operating segment, the Company signed definitive agreements to sell its NIKE Brand businesses in Brazil, Argentina, Chile and Uruguay to third-party distributors. Specifically, NIKE entered into agreements to sell its operations in Argentina, Chile and Uruguay to Grupo Axo and to sell substantially all of its operations in Brazil to Grupo SBF S.A., through its wholly owned subsidiary. The Company has maintained a small operation in Brazil focused on certain sports marketing assets, local manufacturing and Converse. As a result of this decision, beginning in the third quarter of fiscal 2020, the related assets and liabilities of these entities were classified as held-for-sale within Prepaid expenses and other current assets and Accrued liabilities, respectively, on the Unaudited Condensed Consolidated Balance Sheets. BRAZIL During the third quarter of fiscal 2021, the transaction with Grupo SBF S.A. closed and the Company recognized a loss of $53 million, of which $47 million was recognized during the second quarter of fiscal 2021 within Other (income) expense, net, classified within Corporate, on the Unaudited Condensed Consolidated Statements of Income. Cash proceeds received were reflected within Other investing activities on the Unaudited Condensed Consolidated Statements of Cash Flows. As of May 31, 2020, held-for-sale assets and liabilities consisted of the following: •Held-for-sale assets of $272 million, primarily consisting of $142 million of Inventories and $101 million of Accounts receivable, net; and •Held-for-sale liabilities of $91 million, primarily consisting of $51 million of Accrued liabilities. ARGENTINA, CHILE AND URUGUAY During the third quarter of fiscal 2021, the Company and Grupo Axo mutually agreed to terminate the sale and purchase agreement for the transition of NIKE’s businesses in Argentina, Chile and Uruguay to a distributor partnership. However, as the Company remains committed to selling its legal entities in all three countries and granting distribution rights to third-party distributors, the assets and liabilities of the entities have remained classified as held-for-sale on the Unaudited Condensed Consolidated Balance Sheets. As of February 28, 2021, held-for-sale assets and liabilities consisted of the following: •Held-for-sale assets of $195 million, primarily consisting of $83 million of Inventories and $70 million of Accounts receivable, net; and •Held-for-sale liabilities of $59 million, primarily consisting of $24 million of Accrued liabilities. As of May 31, 2020, held-for-sale assets and liabilities consisted of the following: •Held-for-sale assets of $234 million, primarily consisting of $122 million of Inventories and $50 million of Prepaid expenses and other current assets; and •Held-for-sale liabilities of $55 million, primarily consisting of $34 million of Accrued liabilities. As of February 28, 2021, the Company recognized total expected net losses related to the Argentina, Chile and Uruguay transaction of $373 million within Other (income) expense, net, classified within Corporate, and a corresponding allowance within Accrued liabilities on the Unaudited Condensed Consolidated Balance Sheets. The expected loss, which was primarily recognized in fiscal 2020, is largely due to the anticipated release of the cumulative foreign currency translation losses.

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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