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Acquisitions and Divestitures | 12 Months Ended
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Dec. 31, 2021
Business Combination and Asset Acquisition [Abstract] |
Acquisitions and Divestitures | Acquisitions and Divestitures All of the Company’s acquisitions of businesses have been accounted for under ASC 805, Business Combinations. Accordingly, the accounts of the acquired companies, after adjustments to reflect the fair values assigned to assets and liabilities, have been included in the Company’s consolidated financial statements from their respective dates of acquisition. The results of operations of the acquired companies have been included in the Company’s consolidated results since the dates of acquisition. Supplemental pro forma information has not been provided as the acquisitions did not have a material impact on the Company’s consolidated results of operations individually or in the aggregate. 2021 Acquisitions ABEL On March 10, 2021, the Company acquired the stock of ABEL Pumps, L.P. and certain of its affiliates (“ABEL”). ABEL designs and manufactures highly engineered reciprocating positive displacement pumps for a variety of end markets, including mining, marine, power, water, wastewater and other general industries. Headquartered in Büchen, Germany, with sales and service locations in Madrid, Spain, and subsequent to the acquisition with operations in Mansfield, Ohio, ABEL operates in the Company’s Pumps reporting unit within the FMT segment. ABEL was acquired for cash consideration of $106.3 million. The entire purchase price was funded with cash on hand. Goodwill and intangible assets recognized as part of this transaction were $42.4 million and $46.0 million, respectively. The goodwill is not deductible for tax purposes. The Company made a preliminary allocation of the purchase price for the ABEL acquisition as of the acquisition date based on its understanding of the fair value of the acquired assets and assumed liabilities. These nonrecurring fair value measurements are classified as Level 3 in the fair value hierarchy. As the Company continues to obtain additional information about these assets and liabilities, including intangible asset appraisals, inventory valuation and accrued expenses, and continues to integrate the newly acquired business, the Company will refine the estimates of fair value and more accurately allocate the purchase price. Only items identified as of the acquisition date are considered for subsequent adjustment. The Company will continue to make required adjustments to the purchase price allocation prior to the completion of the measurement period. The preliminary allocation of the purchase price to the assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, is as follows:
(In millions) | Total
Current assets, net of cash acquired | $ | 18.4 |
Property, plant and equipment | 4.0 |
Goodwill | 42.4 |
Intangible assets | 46.0 |
Deferred income taxes | 2.6 |
Other noncurrent assets | 0.1 |
Total assets acquired | 113.5 |
Current liabilities | (7.1) |
Other noncurrent liabilities | (0.1) |
Net assets acquired | $ | 106.3 |
Acquired intangible assets consist of trade names, customer relationships and unpatented technology. The goodwill recorded for the acquisition reflects the strategic fit, revenue and earnings growth potential of this business. The acquired intangible assets and weighted average amortization periods are as follows:
(In millions, except weighted average life) | Total |  | Weighted Average Life
Trade names | $ | 9.0 |  |  | 15
Customer relationships | 30.0 |  |  | 13
Unpatented technology | 7.0 |  |  | 11
Acquired intangible assets | $ | 46.0 |  |  |
Airtech On June 14, 2021, the Company acquired the stock of Airtech Group, Inc., US Valve Corporation and related entities (“Airtech”). Airtech designs and manufactures a wide range of highly-engineered pressure technology products, including vacuum pumps, regenerative blowers, compressor systems and valves for a variety of end markets, including alternative energy, food processing, medical, packaging and transportation. Headquartered in Rutherford, New Jersey, with primary manufacturing operations in Werneck, Germany and Shenzhen, China, Airtech operates in the Company’s Performance Pneumatic Technologies reporting unit within the HST segment. Airtech was acquired for cash consideration of $471.0 million. The entire purchase price was funded with cash on hand. Goodwill and intangible assets recognized as part of this transaction were $267.6 million and $202.3 million, respectively. The goodwill is not deductible for tax purposes. The Company made a preliminary allocation of the purchase price for the Airtech acquisition as of the acquisition date based on its understanding of the fair value of the acquired assets and assumed liabilities. These nonrecurring fair value measurements are classified as Level 3 in the fair value hierarchy. As the Company continues to obtain additional information about these assets and liabilities, including intangible asset appraisals, inventory valuation and accrued expenses, and continues to integrate the newly acquired business, the Company will refine the estimates of fair value and more accurately allocate the purchase price. Only items identified as of the acquisition date are considered for subsequent adjustment. The Company will continue to make required adjustments to the purchase price allocation prior to the completion of the measurement period. The preliminary allocation of the purchase price to the assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, is as follows:
(In millions) | Total
Current assets, net of cash acquired | $ | 45.3 |
Property, plant and equipment | 4.8 |
Goodwill | 267.6 |
Intangible assets | 202.3 |
Other noncurrent assets | 10.1 |
Total assets acquired | 530.1 |
Current liabilities | (10.1) |
Deferred income taxes | (40.6) |
Other noncurrent liabilities | (8.4) |
Net assets acquired | $ | 471.0 |
Acquired intangible assets consist of trade names, customer relationships and unpatented technology. The goodwill recorded for the acquisition reflects the strategic fit, revenue and earnings growth potential of this business. The acquired intangible assets and weighted average amortization periods are as follows:
(In millions, except weighted average life) | Total |  | Weighted Average Life
Trade names | $ | 15.4 |  |  | 15
Customer relationships | 162.9 |  |  | 13
Unpatented technology | 24.0 |  |  | 11
Acquired intangible assets | $ | 202.3 |  |  |
The Company incurred $6.5 million of acquisition-related transaction costs in 2021. These costs were recorded in Selling, general and administrative expenses and were related to completed transactions, pending transactions and potential transactions, including transactions that ultimately were not completed. The Company also incurred fair value inventory step-up charges of $2.5 million and $9.1 million associated with the acquisitions of ABEL and Airtech, respectively, which were recorded in Cost of sales in the Consolidated Statements of Income for the year ended December 31, 2021. 2020 Acquisitions Flow MD On February 28, 2020, the Company acquired the membership interests of Flow Management Devices, LLC (“Flow MD”), a privately held provider of flow measurement systems that ensure custody transfer accuracy in the oil and gas industry. Flow MD engineers and manufactures small volume provers. Headquartered in Phoenix, Arizona, with operations in Houston, Texas and Pittsburgh, Pennsylvania, Flow MD operates in the Company’s Energy reporting unit within the FMT segment. Flow MD was acquired for cash consideration of $121.2 million. The entire purchase price was funded with cash on hand. Goodwill and intangible assets recognized as part of this transaction were $60.0 million and $53.0 million, respectively. The goodwill is deductible for tax purposes. The Company finalized the allocation of the purchase price for the Flow MD acquisition as of the acquisition date based on its understanding of the fair value of the acquired assets and assumed liabilities. These nonrecurring fair value measurements are classified as Level 3 in the fair value hierarchy. The final allocation of the purchase price to the assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, is as follows:
(In millions) | Total
Current assets, net of cash acquired | $ | 32.9 |
Property, plant and equipment | 4.2 |
Goodwill | 60.0 |
Intangible assets | 53.0 |
Other noncurrent assets | 1.3 |
Total assets acquired | 151.4 |
Current liabilities | (32.3) |
Deferred income taxes | 2.5 |
Other noncurrent liabilities | (0.4) |
Net assets acquired | $ | 121.2 |
Acquired intangible assets consist of trade names, customer relationships and unpatented technology. The goodwill recorded for the acquisition reflects the strategic fit, revenue and earnings growth potential of this business. The acquired intangible assets and weighted average amortization periods are as follows:
(In millions, except weighted average life) | Total |  | Weighted Average Life
Trade names | $ | 6.0 |  |  | 15
Customer relationships | 31.5 |  |  | 10
Unpatented technology | 15.5 |  |  | 20
Acquired intangible assets | $ | 53.0 |  |  |
Qualtek On November 23, 2020, the Company acquired Qualtek Manufacturing, Inc. (“Qualtek”), a manufacturer of high quality specialty metal components and parts by providing vertically integrated tool and die, metal stamping and metal finishing services. Headquartered in Colorado Springs, Colorado, Qualtek operates in the BAND-IT reporting unit within the FSDP segment. Qualtek was acquired for cash consideration of $1.9 million. The entire purchase price was funded with cash on hand. Goodwill recognized as part of this transaction was $1.1 million. The goodwill recorded for the acquisition reflects the strategic fit, revenue and earnings growth potential of this business. The goodwill is deductible for tax purposes. The Company finalized its allocation of the purchase price for the Qualtek acquisition as of the acquisition date based on its understanding of the fair value of the acquired assets. These nonrecurring fair value measurements are classified as Level 3 in the fair value hierarchy. The Company incurred $4.3 million of acquisition-related transaction costs in 2020. These costs were recorded in Selling, general and administrative expenses and were related to completed transactions, pending transactions and potential transactions, including transactions that ultimately were not completed. The Company also incurred fair value inventory step-up charges of $4.1 million and $0.1 million associated with the acquisitions of Flow MD and Qualtek, respectively, which were recorded in Cost of sales in the Consolidated Statements of Income for the year ended December 31, 2020. 2019 Acquisition Velcora On July 18, 2019, the Company acquired the stock of Velcora Holding AB (“Velcora”) and its operating subsidiaries, Roplan and Steridose. Roplan is a global manufacturer of custom mechanical and shaft seals for a variety of end markets including food and beverage, marine, chemical, wastewater and water treatment. Steridose develops engineered hygienic mixers and valves for the global biopharmaceutical industry. Both companies are headquartered in Sweden but also have operations in Ningbo, China; Berkshire, England and Madison, Wisconsin. Roplan and Steridose operate in the HST segment. Velcora was acquired for cash consideration of $87.2 million and the assumption of $51.1 million of debt. The entire purchase price was funded with cash on hand. Goodwill and intangible assets recognized as part of this transaction were $86.6 million and $48.2 million, respectively. The goodwill is not deductible for tax purposes. The Company finalized the allocation of the purchase price for the Velcora acquisition as of the acquisition date based on its understanding of the fair value of the acquired assets and assumed liabilities. These nonrecurring fair value measurements are classified as Level 3 in the fair value hierarchy. The final allocation of the purchase price to the assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, is as follows:
(In millions) | Total
Current assets, net of cash acquired | $ | 20.2 |
Property, plant and equipment | 1.7 |
Goodwill | 86.6 |
Intangible assets | 48.2 |
Other noncurrent assets | 0.8 |
Total assets acquired | 157.5 |
Current liabilities | (7.6) |
Long-term borrowings | (51.1) |
Deferred income taxes | (11.1) |
Other noncurrent liabilities | (0.5) |
Net assets acquired | $ | 87.2 |
Acquired intangible assets consist of trade names, customer relationships and unpatented technology. The goodwill recorded for the acquisitions reflects the strategic fit, revenue and earnings growth potential of these businesses. The acquired intangible assets and weighted average amortization periods are as follows:
(In millions, except weighted average life) | Total |  | Weighted Average Life
Trade names | $ | 7.1 |  |  | 15
Customer relationships | 34.7 |  |  | 12
Unpatented technology | 6.4 |  |  | 9
Acquired intangible assets | $ | 48.2 |  |  |
On September 3, 2019, the Company settled the debt assumed in the Velcora acquisition and incurred a loss on early retirement of $0.7 million which was recorded in Other expense - net in the Consolidated Statements of Income for the year ended December 31, 2019. The Company incurred $1.7 million of acquisition-related transaction costs in 2019. These costs were recorded in Selling, general and administrative expenses and were related to completed transactions, pending transactions and potential transactions, including transactions that ultimately were not completed. The Company also incurred a fair value inventory step-up charge of $3.3 million associated with the acquisition of Velcora, which was recorded in Cost of sales in the Consolidated Statements of Income for the year ended December 31, 2019. Divestitures The Company periodically reviews its operations for businesses which may no longer be aligned with its strategic objectives and focuses on core business and customers. Any resulting gain or loss recognized due to divestitures is recorded within Loss (gain) on sale of businesses - net within Selling, general and administrative expenses in the Consolidated Statements of Income. On March 12, 2021, the Company completed the sale of CiDRA Precision Services (“CiDRA”) for $1.0 million in cash, resulting in a pre-tax gain on the sale of $0.5 million. The Company recorded $0.1 million of income tax expense associated with this transaction during the year ended December 31, 2021. The results of CiDRA were reported within the HST segment and generated $0.9 million of revenues in 2021 through the date of sale. The Company concluded that this divestiture did not meet the criteria for reporting the results of CiDRA as discontinued operations. On December 28, 2020, the Company completed the sale of its Avery Hardoll product line for $0.5 million in cash, resulting in a pre-tax loss on the sale of $0.4 million. The Company recorded $0.3 million of income tax benefit associated with this transaction during the year ended December 31, 2020. The results of Avery Hardoll were reported within the FMT segment and generated $1.2 million of revenues in 2020 through the date of sale. The Company concluded that this divestiture did not meet the criteria for reporting discontinued operations. There were no divestitures that took place during the year ended December 31, 2019.

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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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