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BUSINESS COMBINATION (Tables) | 12 Months Ended
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Jan. 01, 2021
Business Combinations [Abstract] |
Schedule of Calculation of Consideration Transferred | Our calculation of consideration transferred is as follows:
(In millions, except exchange ratio and per share amounts) | June 29, 2019
Outstanding shares of L3 common stock as of June 28, 2019 | 79.63 |
L3 restricted stock unit awards settled in shares of L3Harris common stock | 0.41 |
L3 performance unit awards settled in shares of L3Harris common stock | 0.04 |
| 80.08 |
Exchange Ratio | 1.30 |
Shares of L3Harris common stock issued for L3 outstanding common stock | 104.10 |
Price per share of L3Harris common stock as of June 28, 2019 | $ | 189.13 |
Fair value of L3Harris common stock issued for L3 outstanding common stock | $ | 19,689 |
Fair value of replacement restricted stock units attributable to merger consideration | 10 |
Fair value of L3Harris stock options issued to replace L3 outstanding stock options | 101 |
Withholding tax liability incurred for converted L3 share-based awards | 45 |
Fair value of replacement award consideration | 156 |
Fair value of total consideration | 19,845 |
Less cash acquired | (1,195) |
Total net consideration transferred | $ | 18,650 |
Schedule of Preliminary Measurement of Assets Acquired, Liabilities Assumed and Non Controlling Interest | Our preliminary fair value estimates and assumptions to measure the assets acquired, liabilities assumed and noncontrolling interests in L3 were subject to change as we obtained additional information during the measurement period. We completed our accounting for the L3Harris Merger during the quarter ended July 3, 2020. The following table summarizes the initial fair value amounts recognized during the quarter ended September 27, 2019 for each major class of assets acquired or liability assumed and noncontrolling interests, as well as adjustments during the measurement period:
(In millions) | Preliminary Fair Value as of September 27, 2019 |  | Measurement Period Adjustments |  | Adjusted Fair Value as of July 3, 2020
Receivables | $ | 849 |  |  | $ | (20) |  |  | $ | 829 |
Contract assets | 1,708 |  |  | (57) |  |  | 1,651 |
Inventories | 1,056 |  |  | (73) |  |  | 983 |
Other current assets | 517 |  |  | (16) |  |  | 501 |
Property, plant and equipment | 1,176 |  |  | 43 |  |  | 1,219 |
Operating lease right-of-use assets | 704 |  |  | 108 |  |  | 812 |
Goodwill | 15,423 |  |  | (841) |  |  | 14,582 |
Other intangible assets | 6,768 |  |  | 1,690 |  |  | 8,458 |
Other non-current assets | 327 |  |  | (13) |  |  | 314 |
Total assets acquired | $ | 28,528 |  |  | $ | 821 |  |  | $ | 29,349 |
Accounts payable | $ | 898 |  |  | $ | (13) |  |  | $ | 885 |
Contract liabilities | 722 |  |  | 4 |  |  | 726 |
Other current liabilities | 772 |  |  | 301 |  |  | 1,073 |
Operating lease liabilities | 715 |  |  | 45 |  |  | 760 |
Defined benefit plans | 1,411 |  |  | — |  |  | 1,411 |
Long-term debt, net | 3,548 |  |  | — |  |  | 3,548 |
Other long-term liabilities | 1,661 |  |  | 480 |  |  | 2,141 |
Total liabilities assumed | 9,727 |  |  | 817 |  |  | 10,544 |
Net assets acquired | 18,801 |  |  | 4 |  |  | 18,805 |
Noncontrolling interests | (151) |  |  | (4) |  |  | (155) |
Total net consideration transferred | $ | 18,650 |  |  | $ | — |  |  | $ | 18,650 |
Schedule of Identifiable Intangible Assets Acquired | The following table provides further detail of the fair value and weighted-average amortization period of identified intangible assets acquired by major intangible asset class:
| Weighted Average Amortization Period |  | Total
| (In years) |  | (In millions)
Identifiable intangible assets acquired: |  |  |
Customer relationships — government | 14 |  | $ | 5,082 |
Customer relationships — commercial | 15 |  | 860 |
Contract backlog | 3 |  | 19 |
Trade names — divisions | 9 |  | 123 |
Developed technologies | 7 |  | 550 |
Total identifiable intangible assets subject to amortization | 13 |  | 6,634 |
Trade names — corporate | indefinite |  | 1,803 |
In-process research and development | n/a |  | 21 |
Total identifiable intangible assets |  |  | $ | 8,458 |
Schedule Merger-related Charges | L3Harris Merger-related charges were as follows:
| Fiscal Year Ended |  | Two Quarters Ended |  | Fiscal Year Ended
(In millions) | January 1, 2021 |  | January 3, 2020 |  | June 28, 2019
Equity award acceleration charges, recognized upon change in control | $ | — |  |  | $ | 70 |  |  | $ | — |
Transaction costs, recognized as incurred | — |  |  | 83 |  |  | 31 |
Additional cost of sales related to the fair value step-up in inventory sold | 31 |  |  | 142 |  |  | — |
Restructuring charges, recognized as incurred | 10 |  |  | 117 |  |  | — |
Facility consolidation costs | — |  |  | 48 |  |  | — |
Integration costs, recognized as incurred | 130 |  |  | 72 |  |  | 34 |
Total L3Harris Merger-related charges | $ | 171 |  |  | $ | 532 |  |  | $ | 65 |
Schedule of Pro Forma Results | The following unaudited consolidated pro forma results of operations for the four quarters ended January 3, 2020 combines reported results for the two quarters ended January 3, 2020 with the pro forma results for the two quarters ended June 28, 2019. The pro forma results for the two quarters ended June 28, 2019 were prepared on a pro forma basis, as if the L3Harris Merger had been completed on June 30, 2018, the first day of Harris’ fiscal 2019, after including any post-merger adjustments directly attributable to the L3Harris Merger, such as the sale of the Harris Night Vision business, and after including the impact of adjustments such as amortization of identifiable intangible assets, as well as the related income tax effects. This pro forma presentation does not include any impact of transaction synergies. The pro forma results are not necessarily indicative of our results of operations that actually would have been obtained had the L3Harris Merger been completed on the assumed date or for the period presented, or which may be realized in the future.
| Four Quarters Ended |  | Two Quarters Ended
(In millions) | January 3, 2020 |  | December 28, 2018
Revenue from product sales and services — as reported | $ | 12,856 |  |  | $ | 3,208 |
Revenue from product sales and services — pro forma | 18,097 |  |  | 8,404 |
Income from continuing operations — as reported | 1,347 |  |  | 441 |
Income from continuing operations — pro forma | 1,652 |  |  | 760 |

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