XML 40 R31.htm IDEA: XBRL DOCUMENT

Acquisitions (Tables)

9 Months Ended

Sep. 30, 2022

Business Acquisition [Line Items]

Summary of Preliminary Purchase Price

The purchase price of Photon Control consisted of the following:


Cash paid for outstanding shares		$	302
Less: Cash and cash equivalents acquired			(34	)
Total purchase price, net of cash and cash equivalents acquired		$	268

Under the acquisition method of accounting, the total estimated purchase price is allocated to the acquired tangible and intangible assets and assumed liabilities of

Summary of Estimated Fair Value of Assets Acquired and Liabilities Assumed

The following table summarizes the allocation of the purchase price to the fair values assigned to assets acquired and liabilities assumed at the date of the Photon Control Acquisition:


Current assets		$	51
Intangible assets			121
Goodwill			168
Other non-current assets			9
Total assets acquired			349
Current liabilities			14
Non-current deferred taxes			32
Other non-current liabilities			1
Total liabilities assumed			47
Fair value of assets acquired and liabilities assumed			302
Less: Cash and cash equivalents acquired			(34	)
Total purchase price, net of cash and cash equivalents acquired		$	268

Allocation of Acquired Intangible Assets and Related Estimates of Useful Lives

The following table reflects the allocation of the acquired intangible assets and related estimate of useful lives at the date of the Photon Control Acquisition:


Completed technology		$	110			9 years
Customer relationships			9			10 years
Backlog			2			1.5 years
		$	121

Atotech Limited [Member]

Business Acquisition [Line Items]

Summary of Preliminary Purchase Price

The preliminary purchase price of Atotech consisted of the following:


Cash consideration to Atotech stockholders, net		$	2,886
Value of MKS shares issued			1,186
Repayment of Atotech debt(1)			1,545
Settlement of Atotech share-based awards(2)			47
Total purchase price, net of cash and cash equivalents acquired		$	5,664

(1)

Represents the cash paid for the outstanding principal of Atotech's senior secured term loans.

(2)

Represents the amount paid to the holders of Atotech options that became fully vested on the Effective Date and the fair value of vested but unissued Atotech share-based awards.

Summary of Estimated Fair Value of Assets Acquired and Liabilities Assumed

The following table summarizes the allocation of the preliminary purchase price to the fair values assigned to assets acquired and liabilities assumed at the Effective Date:


Cash and cash equivalents		$	238
Trade accounts receivable			273
Inventories			280
Other current assets			114
Property, plant and equipment			285
Intangible assets			3,251
Goodwill			2,720
Other assets			146
Total assets acquired			7,307
Accounts payable			197
Other current liabilities			203
Non-current deferred taxes			859
Non-current accrued compensation			94
Other non-current liabilities			52
Total liabilities assumed			1,405
Fair value of assets acquired and liabilities assumed			5,902
Less: Cash and cash equivalents acquired			(238	)
Total purchase price, net of cash and cash equivalents acquired		$	5,664

The allocation of estimated purchase consideration

Allocation of Acquired Intangible Assets and Related Estimates of Useful Lives

The following table reflects the preliminary allocation of the acquired intangible assets and related estimate of useful lives at the Effective Date:


Developed technology		$	813			9 years
Customer relationships			2,080			16 years
Trade names			195			8 years
Other intangible assets			98			4 years
In process research and development			65			12 years
		$	3,251

The acquired intangible assets are being amortized on a straight-line basis, which approximates the economic use of the assets over their estimated useful lives.

Schedule of Revenue and Net Income

The Company's condensed consolidated statement of operations for the three and nine months ended September 30, 2022, includes the following amounts of revenue and net income of Atotech since the Effective Date:


		Three and Nine Months Ended September 30,
		2022
Total net revenues		$	177
Net loss		$	(44	)

Schedule of Unaudited Pro Forma Financial Information

The following unaudited pro forma financial information presents the combined results of operations of the Company as if the Atotech Acquisition had occurred on January 1, 2021. The unaudited pro forma financial information is not necessarily indicative of what the Company's condensed consolidated results of operations actually would have been had the acquisition occurred at the beginning of the year. In addition, the unaudited pro forma financial information does not attempt to project the future results of operations of the combined Company.


		Three Months Ended September 30,								Nine Months Ended September 30,
		2022				2021				2022				2021
Total net revenues		$	1,141			$	1,125			$	3,364			$	3,298
Net (loss) income		$	(34	)		$	95			$	166			$	193

The unaudited pro forma information for the three and nine months ended September 30, 2022 and 2021 give effect primarily to the following:

•

Applying the Company's accounting policies;

•

Incremental interest expense related to the New Term Loan Facility;

•

Incremental amortization of acquired intangible assets related to the estimated fair value from the purchase price allocation;

•

The exclusion of inventory step-up amortization from the three and nine months ended September 30, 2022 and the addition of this amortization to the nine months ended September 30, 2021;

•

Incremental compensation expense for share-based compensation arrangements; and

•

The estimated tax impact of the above adjustments.