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Acquisitions and Divestitures | 6 Months Ended
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Jun. 30, 2020
Business Combinations [Abstract] |
Acquisitions and Divestitures | Note 2. Acquisitions and Divestitures On April 1, 2020, we acquired a majority interest in Give & Go, a North American leader in fully-finished sweet baked goods and owner of the famous two-bite® brand of brownies and the Create-A-Treat® brand, known for cookie and gingerbread house decorating kits. The acquisition of Give & Go provides access to the in-store bakery channel and expands our position in broader snacking. The purchase consideration for Give & Go totaled $1,141 million, net of cash received. We are working to complete the valuation and have recorded a preliminary purchase price allocation of $511 million to definite-lived intangible assets, $42 million to indefinite-lived intangible assets, $530 million to goodwill, $136 million to property, plant and equipment, $71 million to operating lease right of use assets, $38 million to inventory, $29 million to accounts receivable, $3 million to other current assets, $41 million to current liabilities, $83 million to deferred tax liabilities, $66 million to long-term operating lease liabilities, $7 million to long-term debt and $19 million to long-term other liabilities. The acquisition added incremental net revenues of $91 million and an operating loss of $8 million during the three and six months ended June 30, 2020. We incurred $10 million of acquisition-related costs during the three months and $15 million during the six months ended June 30, 2020. On July 16, 2019, we acquired a majority interest in a U.S. refrigerated nutrition bar company, Perfect Snacks, within our North America segment for $284 million cash paid, net of cash received, and expanded our position in broader snacking. During the first quarter of 2020, we finalized the purchase price allocation of $31 million to definite-lived intangible assets, $107 million to indefinite-lived intangible assets, $150 million to goodwill, $1 million to property, plant and equipment, $12 million to inventory, $8 million to accounts receivable, $13 million to current liabilities, $3 million to deferred tax liabilities and $9 million to other liabilities. The acquisition added incremental net revenues of $23 million in the three months and $55 million in the six months ended June 30, 2020, and an immaterial amount of incremental operating income during the three and six months ended June 30, 2020. On May 28, 2019, we completed the sale of most of our cheese business in the Middle East and Africa to Arla Foods of Denmark. In 2019, we received cash proceeds of $161 million, $158 million of which was received in the second quarter of 2019, and divested $19 million of current assets and $96 million of non-current assets. During 2019, we recorded a net pre-tax gain of $44 million on the sale, $41 million of which was recorded in the second quarter of 2019. The divestiture resulted in a year-over-year decline in net revenues of $22 million during the three months and $55 million during the six months ended June 30, 2020, and a year-over-year decline in operating income of $5 million during the three months and $9 million during the six months ended June 30, 2020. During the three and six months ended June 30, 2020, we recorded a $2 million reversal of divestiture-related cost accruals no longer required. We incurred divestiture-related costs of $11 million in the three months and $10 million in the six months ended June 30, 2019.

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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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