XML 47 R28.htm IDEA: XBRL DOCUMENT v3.20.1

Finisar Acquisition (Tables)

9 Months Ended

Mar. 31, 2020

Business Combinations [Abstract]

Preliminary Fair Value of Consideration

The preliminary total fair value of consideration paid in connection with the acquisition of Finisar consisted of the following (in $000):

			Shares						Per Share						Total Consideration
Cash paid for outstanding shares of Finisar common stock															$	1,879,086
II-VI common shares issued to Finisar stockholders			26,712,822						$	36.98					987,707
Replacement equity awards attributable to pre-combination service															41,710
															$	2,908,503

Preliminary Allocation of Purchase Price Based on Estimated Fair Value of Assets Acquired and Liabilities Assumed

Our preliminary allocation of the purchase price of Finisar, based on the estimated fair value of the assets acquired and liabilities assumed as of the Closing Date, is as follows (in $000):

						Preliminary Purchase Price Allocation
						Previously												Measurement
						Reported						Reclassification						Period						As Adjusted
						September 30, 2019						Adjustments						Adjustments (a)						(preliminary)
Cash and cash equivalents						$	842,764					$	(287)					$	—					$	842,477
Accounts receivable						260,864						—						(150)						260,714
Inventories						437,867						—						1,841						439,708
Property, plant & equipment (b)						748,858						—						(77,161)						671,697
Intangible assets (c)						827,689						—						(157,989)						669,700
Other assets (d) (h)						82,624						287						(9,164)						73,747
Deferred tax assets (e)						—						—						11,721						11,721
Accounts payable						(123,707)						—						—						(123,707)
Other accrued liabilities (d) (f) (h)						(148,425)						(43,964)						(58,205)						(250,594)
Deferred tax liabilities (e)						(197,809)						43,964						77,946						(75,899)
Debt						(575,000)						—						—						(575,000)
Goodwill						759,239						—						204,700						963,939
Total Purchase Price (g)						$	2,914,964					$	—					$	(6,461)					$	2,908,503

(a) The Company recorded measurement period adjustments to its preliminary acquisition date fair values due to the refinement of its valuation models, assumptions and inputs. The following measurement period adjustments were based upon information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the measurement of the amounts recognized at that date.

(b) The Company estimated the fair value of the property, plant, and equipment acquired as part of the Finisar acquisition to be $671.7 million. As a result, the fair value of the property, plant, and equipment was decreased by $77.2 million on March 31, 2020 with a corresponding increase to goodwill. The change to the preliminary amount would have resulted in a decrease to depreciation expense within cost of goods sold and accumulated depreciation of approximately $8.5 million for the six months ended December 31, 2019.

(c) The Company estimated the fair value of the intangible assets acquired as part of the Finisar acquisition to be $669.7 million. As a result, the fair value of the intangible assets was decreased by $158.0 million at March 31, 2020 with a corresponding increase to goodwill. The change to the preliminary amount would have resulted in a decrease to amortization expense within selling, general, and administrative and accumulated amortization of approximately $14.4 million for the six months ended December 31, 2019.

(d) The Company reassessed the lease term and discount rates on the right of use assets acquired as part of the Finisar acquisition. As a result, the preliminary fair value of the right of use assets acquired were decreased by $16.0 million on March 31, 2020 with a corresponding decrease in the lease liability.

(e) The Company has adjusted its deferred tax asset and liability positions as of March 31, 2020, $11.7 million and $77.9 million, respectively, as a result of measurement period adjustments.

(f) In addition to the $16.0 million reduction of lease liabilities described in (d) above, the Company recorded approximately $56.5 million of uncertain tax positions (See Note 11), and approximately $11.0 million of other liabilities, as measurement period adjustments.

(g) Total purchase price decreased $6.5 million for the deferred tax impact of the purchase price component associated with replacement equity awards attributable to pre-combination service of Finisar employees.

(h) Other assets and other accrued liabilities increased $6.8 million for a litigation matter and related insurance recovery.

Unaudited Supplemental Pro Forma Financial Information

The unaudited supplemental pro forma financial information for the period presented is as follows (in $000):

			Three Months Ended March 31, 2020						Nine Months Ended March 31, 2020						Three Months Ended March 31, 2019						Nine Months Ended March 31, 2019
Revenue			$	627,041					$	1,901,528					$	666,052					$	1,966,318
Net Earnings (Loss)			5,253						2,926						(10,077)						(113,152)

X

- Definition

Tabular disclosure of pro forma results of operations for a material business acquisition or series of individually immaterial business acquisitions that are material in the aggregate.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (h)(2)
-URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1392-128463

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (h)(3)
-URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1392-128463

+ Details

Name:	us-gaap_BusinessAcquisitionProFormaInformationTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- References

No definition available.

+ Details

Name:	us-gaap_BusinessCombinationsAbstract
Namespace Prefix:	us-gaap_
Data Type:	xbrli:stringItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of a material business combination completed during the period, including background, timing, and recognized assets and liabilities. This table does not include leveraged buyouts.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1486-128463

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=79982066&loc=d3e1392-128463

+ Details

Name:	us-gaap_ScheduleOfBusinessAcquisitionsByAcquisitionTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed. May include but not limited to the following: (a) acquired receivables; (b) contingencies recognized at the acquisition date; and (c) the fair value of noncontrolling interests in the acquiree.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
-SubTopic 20
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=116869197&loc=d3e4845-128472

+ Details

Name:	us-gaap_ScheduleOfRecognizedIdentifiedAssetsAcquiredAndLiabilitiesAssumedTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration