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Acquisitions | 9 Months Ended
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Mar. 31, 2019
Business Combinations [Abstract] |
Acquisitions |
Note 4. | Acquisitions
CoAdna Holdings, Inc. In September 2018, the Company acquired CoAdna Holdings, Inc. (“CoAdna”), a previously publicly traded company on the Taiwan Stock Exchange with headquarters in Sunnyvale, CA, in a cash transaction valued at approximately $85.0 million, inclusive of cash acquired of approximately $42.2 million at closing. CoAdna is a global leader in wavelength selective switches based on its patented liquid crystal platform. CoAdna operates within the Company’s II-VI Photonics operating segment. Due to the timing of the acquisition, the Company is still in the process of measuring the fair value of assets acquired and liabilities assumed, including tangible and intangible assets and related deferred income taxes. The following table presents the preliminary allocation of the purchase price of the assets acquired and liabilities assumed at the date of acquisition, as the Company intends to finalize its accounting for the acquisition of CoAdna within one year from the date of acquisition ($000):
Assets |  |  |  |  |
Accounts receivable |  | $ |  | 5,684 |
Inventories |  |  |  | 6,189 |
Prepaid and other assets |  |  |  | 2,866 |
Property, plant & equipment |  |  |  | 3,181 |
Intangible assets |  |  |  | 16,072 |
Goodwill |  |  |  | 24,844 |
Total assets acquired |  | $ |  | 58,836 |
Liabilities |  |  |  |  |
Accounts payable |  | $ |  | 4,006 |
Other accrued liabilities |  |  |  | 2,717 |
Accrued income taxes |  |  |  | 5,791 |
Deferred tax liabilities |  |  |  | 3,506 |
Total liabilities assumed |  |  |  | 16,020 |
Net assets acquired |  | $ |  | 42,816 |
The goodwill of $24.8 million is included in the II-VI Photonics segment and is attributed to the expected synergies and the assembled workforce of CoAdna. None of the goodwill is deductible for income tax purposes. The fair value of accounts receivable acquired was $5.7 million, with the gross contractual amount being $5.7 million. The Company expensed transaction costs during the nine months ended March 31, 2019 of $1.9 million. The amount of revenues of CoAdna included in the Company’s Condensed Consolidated Statements of Earnings for the three and nine months ended March 31, 2019, was $2.3 million and $12.4 million, respectively. The amount of net loss of CoAdna included in the Company’s Condensed Consolidated Statement of Earnings for the three and nine months ended March 31, 2019 was immaterial. Purchase of a Product Line In November 2018, the Company acquired certain assets of a product line in a cash transaction valued at approximately $10.0 million. In conjunction with the acquisition of the product line, the Company acquired inventory of $0.2 million, equipment of $2.3 million, acquired technology of $6.3 million, and recorded goodwill of $1.2 million. The goodwill is deductible for income tax purposes. The goodwill is recorded in the II-VI Photonics segment and is attributed to the workforce acquired as part of the transaction. Transaction expenses for this acquisition were insignificant for the three and nine months ended March 31, 2019. Redstone Aerospace Corporation In March 2019, the Company acquired Redstone Aerospace Corporation (“Redstone”), an aerospace and defense company located in Colorado. Redstone has unique capabilities to continue our growth in the emerging high-energy market. The consideration consisted of initial cash paid at the acquisition date of $28.0 million, net of cash acquired. In addition, the acquisition agreement provides up to a maximum of $2.0 million of additional cash earn out opportunities based on achievement of certain agreed-upon financial objectives. The following table presents the preliminary purchase price at the date of acquisition ($000):
Net cash paid at acquisition |  | $ |  | 27,959 |
Fair value of cash earn out arrangement |  |  |  | 1,776 |
Purchase price |  | $ |  | 29,735 |
Due to the timing of the acquisition, the Company is still in the process of measuring the fair value of assets acquired and liabilities assumed, including tangible and intangible assets and related deferred income taxes. The following table presents a preliminary allocation of the purchase price of the assets acquired and liabilities assumed at the date of acquisition ($000):
Assets |  |  |  |  |
Accounts receivable |  | $ |  | 1,800 |
Property, plant & equipment |  |  |  | 300 |
Intangible assets |  |  |  | 9,100 |
Goodwill |  |  |  | 19,700 |
Total assets acquired |  | $ |  | 30,900 |
Liabilities |  |  |  |  |
Non-Interest bearing liabilities |  | $ |  | 1,165 |
Total liabilities assumed |  |  |  | 1,165 |
Net assets acquired |  | $ |  | 29,735 |
The goodwill is recorded in the II-VI Performance Products segment and is attributed to the technology and workforce acquired as part of the transaction. The goodwill is non-deductible for income tax purposes. At the time of the acquisition, the Company expected to collect all of the accounts receivable. Transaction expenses for this acquisition were insignificant for the three and nine months ended March 31, 2019. The amount of revenues and net earnings from the acquisition included in the Company’s Condensed Consolidated Statements of Earnings for the three and nine months ended March 31, 2019 were insignificant.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: 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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