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Business Divestitures (Tables) | 9 Months Ended
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Oct. 01, 2021
Discontinued Operations and Disposal Groups [Abstract] |
Schedule of Business Divestitures | The following table presents information regarding businesses held for sale as of October 1, 2021:
|  |  |  |  | Sale Price(1) |
| Business Segment |  | Date of Agreement |  | (In millions) |
Narda-MITEQ(2) | Aviation Systems |  | August 31, 2021 |  | $ | 75 |  |
ESSCO(3) | Aviation Systems |  | September 1, 2021 |  | 55 |  |
_______________ (1) Subject to customary purchase price adjustments and closing conditions as set forth in the definitive agreement. (2) The Narda-MITEQ business manufactures component, satellite communication and radio frequency safety products for both military and commercial markets. We expect to complete the sale of the Narda-MITEQ business in the next two quarters. (3) The ESSCO business manufactures metal space frame ground radomes and composite structures. We expect to complete the sale of the ESSCO business in the fourth quarter of 2021. The carrying amounts of the major classes of assets and liabilities for businesses classified as held for sale included in our Condensed Consolidated Balance Sheet (Unaudited) at October 1, 2021 were as follows:
(In millions) | Narda-MITEQ business |  | ESSCO business |  | Consolidated Total
Receivables, net | $ | 14 |  |  | $ | 3 |  |  | $ | 17 |
Contract assets | 12 |  |  | 1 |  |  | 13 |
Inventories | 26 |  |  | 4 |  |  | 30 |
Other current assets | 1 |  |  | — |  |  | 1 |
Property, plant and equipment, net | 11 |  |  | 4 |  |  | 15 |
Goodwill | 7 |  |  | 4 |  |  | 11 |
Other intangible assets | 21 |  |  | 10 |  |  | 31 |
Deferred taxes | 1 |  |  | — |  |  | 1 |
Other non-current assets | 33 |  |  | 3 |  |  | 36 |
Assets of businesses held for sale | $ | 126 |  |  | $ | 29 |  |  | $ | 155 |
Accounts payable | $ | 7 |  |  | $ | 2 |  |  | $ | 9 |
Contract liabilities | 2 |  |  | 2 |  |  | 4 |
Other accrued items | 7 |  |  | 2 |  |  | 9 |
Other non-current liabilities | 34 |  |  | 2 |  |  | 36 |
Deferred taxes | — |  |  | 2 |  |  | 2 |
Liabilities of businesses held for sale | $ | 50 |  |  | $ | 10 |  |  | $ | 60 |
The carrying amounts of the assets and liabilities of the Voice Switch Enterprise disposal group (“VSE disposal group”) classified as held for sale in our Consolidated Balance Sheet at January 1, 2021 were $35 million and $13 million, respectively. Completed Divestitures The following table presents information regarding business divestitures completed by us during the three quarters ended October 2, 2020 and fiscal year ended January 1, 2021:
(In millions) | Business Segment(1) |  | Date of Divestiture |  | Sale Price |  | Net Cash Proceeds(2) |
Three quarters ended October 1, 2021 |  |  |  |  |  |  |  |
Electron Devices business(3) | Aviation Systems |  | October 1, 2021 |  | $ | 185 |  |  | $ | 173 |  |
VSE disposal group(4) | Aviation Systems |  | July 30, 2021 |  | 20 |  |  | 19 |  |
CPS business(5) | Aviation Systems |  | July 2, 2021 |  | 398 |  |  | 347 |  |
Military training business(6) | Aviation Systems |  | July 2, 2021 |  | 1,050 |  |  | 1,059 |  |
|  |  |  |  | $ | 1,653 |  |  | $ | 1,598 |  |
Fiscal year ended January 1, 2021 |  |  |  |  |  |  |  |
EOTech business(7) | Communication Systems |  | July 31, 2020 |  | $ | 42 |  |  | $ | 40 |  |
Applied Kilovolts business(8) | Space and Airborne Systems |  | May 15, 2020 |  | 12 |  |  | 12 |  |
Airport security and automation business(9) | Aviation Systems |  | May 4, 2020 |  | 1,000 |  |  | 987 |  |
|  |  |  |  | $ | 1,054 |  |  | $ | 1,039 |  |
_______________ (1) Business segment in which the operating results of each divested business were reported through the date of divestiture. (2) Net cash proceeds after selling costs and purchase price adjustments. (3) The Electron Devices and Narda Microwave-West divisions (“Electron Devices business”) manufactures microwave devices for ground-based, airborne and satellite communications and radar. (4) The VSE disposal group provides voice over internet protocol systems for air traffic management communications. (5) The Combat Propulsion Systems and related businesses (“CPS business”) engineers, designs and manufactures engines, transmissions, suspensions and turret drive systems for tracked and wheeled combat vehicle systems. (6) The military training business provides flight simulation solutions and training services to the U.S. Department of Defense (“DoD”) and foreign military agencies. (7) The EOTech business manufactures holographic sighting systems, magnified field optics and accessories for military, law enforcement and commercial markets around the world. (8) The Applied Kilovolts and Analytical Instrumentation business (“Applied Kilovolts business”) business manufactures high-voltage power supplies and ion detectors for customers in fields such as biotechnology, materials science, healthcare, forensics, environmental sciences, and homeland security. (9) The airport security and automation business provides solutions used by the aviation and transportation industries, regulatory and customs authorities, government and law enforcement agencies and commercial and other high-security facilities. Income Before Income Taxes Attributable to Businesses Divested The following table presents the amount of income before income taxes attributable to businesses divested in our Condensed Consolidated Statement of Income (Unaudited):
| Quarter Ended |  | Three Quarters Ended
(In millions) | October 1, 2021 |  | October 2, 2020 |  | October 1, 2021 |  | October 2, 2020
Electron Devices business | $ | 11 |  |  | $ | 8 |  |  | $ | 41 |  |  | $ | 23 |
CPS business | — |  |  | 16 |  |  | 53 |  |  | 44 |
Military training business | — |  |  | 17 |  |  | 35 |  |  | 57 |
Business Divestiture-related Gains (Losses) The “Business divestiture-related gains (losses)” line item in our Condensed Consolidated Statement of Income (Unaudited) is comprised of the following pre-tax gains (losses) associated with businesses divested or held for sale:
| Quarter Ended |  | Three Quarters Ended
(In millions) | October 1, 2021 |  | October 2, 2020 |  | October 1, 2021 |  | October 2, 2020
VSE disposal group(1) | $ | (4) |  |  | $ | (10) |  |  | $ | (30) |  |  | $ | (24) |
Electron Devices business | 29 |  |  | — |  |  | 29 |  |  | — |
CPS business(2) | — |  |  | — |  |  | (19) |  |  | — |
Military training business | 2 |  |  | — |  |  | 214 |  |  | — |
Airport security and automation business | — |  |  | (2) |  |  | — |  |  | (28) |
Other(3) | — |  |  | 2 |  |  | (2) |  |  | (10) |
Total Business divestiture-related gain (losses) | $ | 27 |  |  | $ | (10) |  |  | $ | 192 |  |  | $ | (62) |
_______________ (1)During the quarter ended July 3, 2020, upon classifying the VSE disposal group as held for sale, we recorded a non-cash impairment charge of $14 million, which is included in the “Impairment of goodwill and other assets” line item in our Condensed Consolidated Statement of Income (Unaudited) for the three quarters ended October 2, 2020. We recognized an $18 million non-cash remeasurement loss related to the VSE disposal group during the year ended January 1, 2021. (2)During the quarter ended April 2, 2021, upon classifying the CPS business as held for sale, we recorded a non-cash impairment charge of $62 million, which is included in the “Impairment of goodwill and other assets” line item in our Condensed Consolidated Statement of Income (Unaudited). See Note I — Goodwill and Other Intangible Assets in these Notes for additional information. (3)Reflects adjustments to the gains and losses on completed divestitures not shown above, including for fiscal 2020, $12 million for finalization of purchase price adjustments and recognition of a non-cash adjustment related to working capital, which decreased the gain initially recognized on the sale of the Harris Night Vision business divested on September 13, 2019.

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