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Business Acquisitions and Dispositions | 6 Months Ended
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Jun. 30, 2024
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] |
Business Acquisitions and Dispositions | Business Acquisitions and Dispositions 2023 Acquisitions In the second quarter of 2023, the Company acquired all of the issued and outstanding membership interests of EI Electronics LLC ("EIG") for a cash purchase price of approximately $60 million, net of cash acquired, subject to customary purchase price adjustments. EIG offers fully integrated energy management and power quality monitoring solutions for the electric utility and commercial and industrial markets. This business is reported in the Utility Solutions segment. In the fourth quarter of 2023, the Company acquired all of the issued and outstanding shares of Indústria Eletromecânica Balestro Ltda. ("Balestro") for a cash purchase price of approximately $87 million, net of cash acquired, subject to customary purchase price adjustments. Balestro is a company headquartered in Mogi Mirim, São Paulo, Brazil and designs, manufactures, and delivers top quality products for the electrical utility industry in Brazil and other countries in Latin America, as well as other parts of the world. This business is reported in the Utility Solutions segment. In the fourth quarter of 2023, the Company acquired Northern Star Holdings, Inc. ("Systems Control") for approximately $1.1 billion, net of cash acquired, subject to customary purchase price adjustments. Systems Control is a manufacturer of substation control and relay panels, as well as turnkey substation control building solutions. This business is reported in the Utility Solutions segment. Preliminary Allocation of Consideration Transferred to Net Assets Acquired The following table presents the updated preliminary determination of the fair values of identifiable assets acquired and liabilities assumed from the Company's 2023 acquisitions. The final determination of the fair value of certain assets and liabilities will be completed within the applicable one year measurement period as required by FASB ASC Topic 805, “Business Combinations.” As the Company finalizes the fair values of assets acquired and liabilities assumed, additional purchase price adjustments may be recorded during the measurement period. Fair value estimates are based on a complex series of judgments about future events and uncertainties and rely heavily on estimates and assumptions. The judgments used to determine the estimated fair value assigned to each class of assets acquired and liabilities assumed, as well as asset lives, can materially impact the Company's results of operations and financial position. The finalization of the purchase accounting assessment may result in a change in the valuation of assets acquired and liabilities assumed and may have a material impact on the Company's results of operations and financial position. The purchase accounting for EIG is complete, and amounts are reflected in the table below. The following table summarizes the preliminary fair values of the assets acquired and liabilities assumed at the date of acquisition for all of the Company's 2023 acquisitions (in millions):
Accounts receivable | $ | 71.5 |
Inventories | 85.7 |
Other current assets | 49.6 |
Property, plant and equipment | 31.9 |
Other non-current assets | 2.8 |
Intangible assets | 602.7 |
Accounts payable | (18.5) |
Other accrued liabilities | (84.0) |
Deferred tax liabilities, net | (132.2) |
Other non-current liabilities | (11.9) |
Goodwill | 608.2 |
Total Estimate of Consideration Transferred, Net of Cash Acquired | $ | 1,205.8 |
Dispositions In December 2023, the Company entered into a definitive agreement to sell its residential lighting business for a cash purchase price of $131 million, subject to customary adjustments. The Company concluded the business met the criteria for classification as held for sale in the fourth quarter of 2023. The residential lighting business was reported within the Electrical Solutions Segment. The transaction closed in the first quarter of 2024 and the Company recorded a pre-tax loss on the sale of $5.3 million, which is recorded within Total other expense in the Company's Condensed Consolidated Statement of Income. Under the terms of the transaction, Hubbell and the buyer entered into a transition services agreement ("TSA"), pursuant to which the Company agreed to provide certain administrative and operational services for a period of 12 months or less. Income from the TSA for the three and six months ended June 30, 2024 was $2.5 million and $4.5 million, respectively, and was recorded in Other expense, net in the Condensed Consolidated Statement of Income. The following table presents balance sheet information of the residential lighting business' assets and liabilities held for sale as of December 31, 2023:
|  | At December 31,
(in millions) |  | 2023
Cash and cash equivalents |  | $ | — |
Accounts receivable, net |  | 29.8 |
Inventories, net |  | 37.8 |
Other current assets |  | 2.9 |
Assets held for sale - current |  | $ | 70.5 |
Property, Plant, and Equipment, net |  | 1.6 |
Goodwill |  | 63.2 |
Other Intangible assets, net |  | 6.5 |
Other long-term assets |  | 20.6 |
Assets held for sale - non-current |  | $ | 91.9 |
Accounts payable |  | 1.9 |
Accrued salaries, wages and employee benefits |  | 3.5 |
Accrued insurance |  | 3.4 |
Other accrued liabilities |  | 15.8 |
Liabilities held for sale - current |  | $ | 24.6 |
Other Non-Current Liabilities |  | 17.5 |
Liabilities held for sale - non-current |  | $ | 17.5 |

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- Definition The entire description for costs incurred to effect a business combination that have been expensed during the period. Such costs could include business integration costs, systems integration and conversion costs, and severance and other employee-related costs. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805/tableOfContent + Details
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