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Acquisitions, Divestitures and Licensing Transactions | 9 Months Ended
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Sep. 28, 2018
Business Combinations [Abstract] |
Acquisitions, Divestitures and Licensing Transactions | Note 4: Acquisitions, Divestitures and Licensing Transactions Acquisition On May 8, 2018, the Company acquired 100% of the outstanding shares of SensL Technologies Ltd. ("SensL"), a company specializing in silicon photomultipliers, single photon avalanche diode and LiDAR sensing products for the automotive, medical, industrial and consumer markets, for $71.6 million in cash. As a result of the acquisition, SensL became a wholly-owned subsidiary of the Company. The purchase price was funded with cash on hand. This acquisition positions the Company to extend its products in automotive sensing applications for ADAS and autonomous driving by adding LiDAR capabilities to the Company’s existing capabilities in imaging and radar. During the third quarter of 2018, the Company recorded certain measurement period adjustments to the initial estimated purchase price allocation of $71.4 million. The following table presents the updated provisional allocation of the purchase price of SensL for the assets acquired and liabilities assumed based on their fair values (in millions):
|  | Initial Estimate | Measurement Period Adjustments | Updated Allocation
Current assets (including cash and cash equivalents of $0.7 million) |  | $ | 4.2 |  | $ | — |  | $ | 4.2 |
Property, plant and equipment and other non-current assets |  | 1.8 |  | — |  | 1.8 |
Goodwill |  | 15.2 |  | 3.7 |  | 18.9 |
Intangible assets (excluding IPRD) |  | 30.4 |  | 1.0 |  | 31.4 |
IPRD |  | 25.0 |  | (5.0 | ) | 20.0 |
Total assets acquired |  | 76.6 |  | (0.3 | ) | 76.3 |
Current liabilities |  | 0.7 |  | — |  | 0.7 |
Other non-current liabilities |  | 4.5 |  | (0.5 | ) | 4.0 |
Total liabilities assumed |  | 5.2 |  | (0.5 | ) | 4.7 |
Net assets acquired/purchase price |  | $ | 71.4 |  | $ | 0.2 |  | $ | 71.6 |
The measurement period adjustments which relate to the change in the value assigned to developed technology and IPRD resulted in an immaterial impact to the amortization expense recorded during the quarter ended June 29, 2018 and were among those expected to be made to the initial estimated purchase price allocation based on information obtained during the measurement period. The adjustments to the initial estimated purchase price allocation are included in the updated provisional purchase price allocation, which is reflected in the Company’s Consolidated Balance Sheet as of September 28, 2018. Acquired intangible assets of $31.4 million include developed technology of $30.0 million (which are estimated to have a seven year weighted-average useful life). The total weighted average amortization period for the acquired intangibles is seven years. IPRD assets are amortized over the estimated useful life of the assets upon successful completion of the related projects. The value assigned to IPRD was determined by estimating the net cash flows from the projects when completed and discounting the net cash flows to their present value using a discount rate of 30.0%. The cash flows from IPRD’s significant products are expected to commence in the fourth quarter of 2018. The acquisition produced $18.9 million of goodwill, which was allocated to the Intelligent Sensing Group. The goodwill is attributable to a combination of SensL’s assembled workforce, expectations regarding a more meaningful engagement by the customers due to the scale of the combined company and other product and operating synergies. Goodwill will not be amortized but instead tested for impairment at least annually (more frequently if certain indicators are present). Goodwill arising from the SensL acquisition is not deductible for tax purposes. The updated purchase price allocation is subject to change as the Company finalizes certain remaining key assumptions and judgments with respect to intangible assets acquired from SensL. The Company expects to complete this process during the fourth quarter of 2018, and any future adjustments may impact the initial estimated amount of goodwill and other allocated amounts represented in the table above. Divestiture On June 25, 2018, the Company divested the transient voltage suppressing diodes business it acquired from Fairchild to TSC America, Inc. for $5.6 million in cash and recorded a gain of $4.6 million after writing off the carrying values of the assets and liabilities disposed. During the quarter ended September 28, 2018, the Company recognized certain immaterial amounts related to this divestiture. Licensing Transactions During 2016 and 2017, the Company entered into an Asset Purchase Agreement with Huaian Imaging Device Manufacturer Corporation (“HIDM”) pursuant to which the Company received $52.5 million in cash in 2017 and provided perpetual, non-exclusive licenses relating to certain technologies to HIDM. Of this amount, $10.0 million was recorded as deferred licensing income to be recognized in the period in which certain qualification requirements of the technologies are achieved (or refunded to HIDM, if such qualification did not occur by June 21, 2018). During the quarter ended June 29, 2018, the Company achieved such qualification requirements for the technologies transferred and recognized $10.0 million as licensing income. On November 29, 2017, the Company and QST Co. Ltd (“QST”) entered into an IP license and technology transfer agreement (“IP Agreement”) to grant QST patent licenses and IP rights to certain of the Company’s technologies. Pursuant to the IP Agreement, QST receives perpetual, worldwide, nonexclusive and nontransferable patents licenses and IP rights upon the payment of license fees of $13.0 million and other fees of $8.5 million in its entirety. Such amounts were paid by QST between the fourth quarter of 2017 and the first and second quarters of 2018. As a result, the Company recognized licensing income of $18.0 million during the quarter ended June 29, 2018. The remaining amounts were previously recognized as licensing income during 2017 and the quarter ended March 30, 2018.

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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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