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Business Acquisitions | 6 Months Ended
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Jun. 28, 2025
Business Acquisitions [Abstract] |
Business Acquisitions | Note 6 – Business Acquisitions Our acquisition strategy is focused on investments in companies that add new customers and sales teams, increase our geographic footprint (whether entering a new country, such as emerging markets, or building scale where we have already invested in businesses), and finally, those that enable us to access new products and technologies. 2025 Acquisitions During the six months ended June 28, 2025, we acquired companies within the Global Distribution and Value- Added Services and Global Specialty Products segments. We acquired ownership interest in these companies ranging from 64 % to 100 %. The following table aggregates the preliminary estimated fair value, as of the date of the acquisition, of consideration paid and net assets acquired for acquisitions during the six months ended June 28, 2025: Preliminary Allocation as of June 28, 2025 Acquisition consideration: Cash $ 96 Deferred consideration 1 Estimated fair value of contingent consideration payable 10 Fair value of previously held equity method investment 7 Noncontrolling interests 24 Total consideration $ 138 Identifiable assets acquired and liabilities assumed: Current assets $ 14 Intangible assets 66 Other noncurrent assets 5 Current liabilities (2) Deferred income taxes (11) Other noncurrent liabilities (4) Total identifiable net assets 68 Goodwill 70 Total net assets acquired $ 138 The accounting for acquisitions in the six months ended June 28, 2025 has not been completed in several areas, including, but not limited to, pending assessment of certain assets, including identifiable intangibles, and liabilities. Goodwill is a result of the synergies and cross-selling opportunities that these acquisitions are expected to provide for us, as well as the expected growth potential. The majority of the acquired goodwill is not deductible for tax purposes. The impact of these acquisitions, individually and in the aggregate, was not considered material to our condensed consolidated financial statements. Pro forma financial information since the acquisition date has not been presented because the impact of these acquisitions was immaterial to our condensed consolidated financial statements. The following table summarizes the intangible assets acquired during the six months ended June 28, 2025: 2025 Weighted Average Useful Lives (in years) Customer relationships and lists 56 11 Trademarks / Tradenames 5 6 Patents 4 10 Non-compete agreements 1 5 Total $ 66 The impact of these acquisitions, individually and in the aggregate, was not considered material to our condensed consolidated financial statements. Pro forma financial information since the acquisition date has not been presented because the impact of these acquisitions was immaterial to our condensed consolidated financial statements. 2024 Acquisitions Acquisition of TriMed On April 1, 2024, we acquired a 60 % voting equity interest in TriMed Inc. (“TriMed”), a global developer of solutions for the orthopedic treatment of lower and upper extremities, headquartered in California, for consideration of $ 315 million. This acquisition is reported in our Global Specialty Products segment. During the year ended December 28, 2024, we completed the accounting for this acquisition. The following table aggregates the final fair value, as of the date of the acquisition, of consideration paid and net assets acquired in the TriMed acquisition: Final Allocation Acquisition consideration: Cash $ 141 Deferred consideration 21 Redeemable noncontrolling interests 153 Total consideration $ 315 Identifiable assets acquired and liabilities assumed: Current assets $ 35 Intangible assets 221 Other noncurrent assets 10 Current liabilities (7) Deferred income taxes (62) Other noncurrent liabilities (6) Total identifiable net assets 191 Goodwill 124 Total net assets acquired $ 315 Goodwill is a result of synergies that are expected to originate from the acquisition as well as the expected growth potential of TriMed. The acquired goodwill is not deductible for tax purposes. The intangible assets acquired consisted of product development of $ 204 million, trademarks and tradenames of $ 9 million, and in-process research and development of $ 8 million. Weighted average useful lives for these acquired intangible assets were 9 years, 7 years and indefinite-lived, respectively. Except for in-process research and development (“IPR&D”), intangible assets acquired as a result of the TriMed acquisition are being amortized over their estimated useful lives using the straight-line method of amortization. IPR&D is accounted for as an indefinite-lived intangible asset and is not amortized until completion or abandonment of the associated research and development efforts. IPR&D is tested for impairment annually or periodically if an indicator of impairment exists during the period until completion. Pro forma financial information and TriMed’s revenue and earnings since the acquisition date have not been presented because the impact of the TriMed acquisition was immaterial to our condensed consolidated financial statements. Other 2024 Acquisitions During the year ended December 28, 2024, we acquired companies within the Global Distribution and Value- Added Services and Global Specialty Products segments. Our acquired ownership interest in these companies range from 51 % to 100 %. Total consideration for these acquisitions was $ 113 million (including cash paid of $ 62 million, fair value of previously held equity investment of $ 30 million, noncontrolling interest of $ 18 million, estimated fair value of contingent consideration payable of $ 2 million, and deferred consideration of $ 1 million). Net assets acquired primarily consisted of $ 60 million of goodwill and $ 64 million of intangible assets. The intangible assets acquired consisted of customer relationships and lists of $ 33 million, trademarks and tradenames of $ 24 million, product development of $ 5 million and non-compete agreements of $ 2 million. Weighted average useful lives for these acquired intangible assets were 11 years, 7 years, 9 years and 5 years, respectively. During the three and six months ended June 28, 2025 we completed the accounting for all acquisitions that occurred in the year ended December 28, 2024. We did not record material adjustments in our condensed consolidated financial statements relating to changes in estimated values of assets acquired, liabilities assumed or contingent consideration assets and liabilities in respect to these acquisitions. Goodwill is a result of the synergies and cross-selling opportunities that these acquisitions are expected to provide for us, as well as the expected growth potential. The majority of the acquired goodwill is not deductible for tax purposes. Pro forma financial information for our 2024 acquisitions has not been presented because the impact of the acquisitions was immaterial to our condensed consolidated financial statements. Acquisition Costs During the three and six months ended June 28, 2025, we incurred $ 1 million and $ 3 million in acquisition costs, respectively. During the three and six months ended June 29, 2024, we incurred $ 1 million and $ 3 million in acquisition costs, respectively. These costs are included in selling, general and administrative in our condensed consolidated statements of income.

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