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Recent Transactions | 6 Months Ended
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Jun. 30, 2018
Business Combinations [Abstract] |
Business Combination Disclosure | Recent Transactions On September 27, 2017, the Company acquired 100% of the equity interests in Sevcon for cash of $185.7 million. This amount included $26.6 million paid to settle outstanding debt and $5.1 million paid for Sevcon stock-based awards attributable to precombination services. Sevcon is a global player in electrification technologies, serving customers in the U.S., U.K., France, Germany, Italy, China and the Asia Pacific region. Sevcon complements BorgWarner’s power electronics capabilities utilized to provide electrified propulsion solutions. Sevcon's operating results and assets are reported within the Company's Drivetrain reporting segment. The following table summarizes the aggregated preliminary fair value of the assets acquired and liabilities assumed on September 27, 2017, the date of acquisition:
(millions of dollars) |  |
Receivables, net |  | $ | 15.9 |
Inventories, net |  | 18.6 |
Other current assets |  | 2.8 |
Property, plant and equipment, net |  | 7.3 |
Goodwill |  | 126.0 |
Other intangible assets |  | 70.7 |
Deferred tax liabilities |  | (9.5 | )
Income taxes payable |  | (0.7 | )
Other assets and liabilities |  | (2.9 | )
Accounts payable and accrued expenses |  | (24.5 | )
Total consideration, net of cash acquired |  | 203.7 |
Less: Assumed retirement-related liabilities |  | 18.0 |
Cash paid, net of cash acquired |  | $ | 185.7 |
In connection with the acquisition, the Company capitalized $17.7 million for customer relationships, $48.8 million for developed technology and $4.2 million for the Sevcon trade name. These intangible assets, excluding the indefinite-lived trade name, will be amortized over a period of 7 to 20 years. Various valuation techniques were used to determine the fair value of the intangible assets, with the primary techniques being forms of the income approach, specifically, the relief-from-royalty and excess earnings valuation methods, which use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy. Under these valuation approaches, the Company is required to make estimates and assumptions about sales, operating margins, growth rates, royalty rates and discount rates based on budgets, business plans, economic projections, anticipated future cash flows and marketplace data. Due to the nature of the transaction, goodwill is not deductible for tax purposes. The Company is in the process of finalizing all purchase accounting adjustments related to the acquisition. The Company has recorded fair value adjustments based on new information obtained during the measurement period primarily related to intangible assets. As of June 30, 2018, these adjustments have resulted in a decrease in goodwill of $7.6 million from the Company's initial estimate. In addition, certain other estimated values for the acquisition, including goodwill, contingencies and deferred taxes are not yet finalized, and the preliminary purchase price allocations are subject to change as the Company completes its analysis of the fair value at the date of acquisition. Due to its insignificant size relative to the Company, supplemental pro forma financial information of the combined entity for the current and prior reporting period is not provided.

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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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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