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Note 2 - Acquisitions and Dispositions | 12 Months Ended
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Dec. 30, 2017
Notes to Financial Statements |
Mergers, Acquisitions and Dispositions Disclosures [Text Block] | 2 . Acquisitions and Dispositions The Company accounts for acquisitions using the acquisition method in accordance with ASC 805, “Business Combinations,” in which assets acquired and liabilities assumed are recorded at fair value as of the date of acquisition. The operating results of the acquired business are included in the Company’s Consolidated Financial Statements from the date of the acquisition. Subsequent Event IXYS Corporation On January 17, 2018, the Company acquired IXYS Corporation (“IXYS”), a global pioneer in the power semiconductor and integrated circuit markets with a focus on medium to high voltage power control semiconductors across the industrial, communications, consumer and medical markets. IXYS has a broad customer base, serving more than 3,500 customers through its direct sales force and global distribution partners. The acquisition of IXYS is expected to accelerate the Company’s growth across the power control market driven by IXYS’s extensive power semiconductor portfolio and technology expertise. With IXYS, the Company will be able to diversify and expand its presence within industrial electronics markets, leveraging the strong IXYS industrial OEM customer base. The Company also expects to increase long-term penetration of its power semiconductor portfolio in automotive markets, expanding its global content per vehicle. The Company has commenced the determination of the purchase price allocation. Upon completion of the acquisition, at IXYS stockholders’ election and subject to proration, each share of IXYS common stock, par value $0.01 per share, owned immediately prior to the effective time were cancelled and extinguished and automatically converted into the right to receive: (i) $23.00 in cash (subject to applicable withholding tax), without interest (referred to as the cash consideration), or (ii) 0.1265 of a share of common stock, par value $0.01 per share, of Littelfuse (referred to as the stock consideration and together with the cash consideration, the merger consideration). IXYS stockholders received cash in lieu of any fractional shares of Littelfuse common stock that the IXYS stockholders would otherwise have been entitled to receive. Additionally, each outstanding option to purchase shares of IXYS common stock granted under an IXYS equity plan were assumed by Littelfuse and converted into an option to acquire (i) a number of shares of Littelfuse common stock equal to the number of shares of IXYS common stock subject to such option immediately prior to the effective time multiplied by 0.1265, rounded down to the nearest whole share, with (ii) an exercise price per share of Littelfuse common stock equal to the exercise price of such IXYS stock option immediately prior to the effective time divided by 0.1265, rounded up to the nearest whole cent. Based on the $207.5 per share opening price of Littelfuse common stock on January 17, 2018, the consideration IXYS stockholders received in exchange of their IXYS common stock in the acquisition had a value of approximately $814.8 million comprised of $380.5 million of cash and $434.2 million of Littelfuse stock. In addition to the consideration transferred related to IXYS common stock, the value of consideration transferred, and included in the purchase price, related to IXYS stock options that were converted to Littelfuse stock options, or cash settled, had a value of approximately $41.7 million. As a result, total consideration is valued at approximately $856.5 million. The Company is in the process of estimating the purchase price allocation. 2017 Acquisitions U.S. Sensor O n July 7, 2017, the Company acquired the assets of U.S. Sensor Corporation (“U.S. Sensor”). The acquisition purchase price of $24.3 million, net of the finalization of an income tax gross up which was settled in the fourth quarter of 2017, was funded with available cash . The acquired business expands the Company’s existing sensor portfolio in several key electronics and industrial end markets. U.S. Sensor manufactures a variety of high quality negative temperature coefficient thermistors as well as thermistor probes and assemblies. Product lines also include thin film platinum resistance temperature detectors (“RTDs”) and RTD assemblies. The following table summarizes the purchase price allocation of the fair value of assets acquired and liabilities assumed in the U.S. Sensor acquisition:
(in thousands) |  | Purchase Price Allocation |
Total purchase consideration: |  |  |  |
Cash |  | $ | 24,340 |
Allocation of consideration to assets acquired and liabilities assumed: |  |  |  |
Current assets, net |  | $ | 4,635 |
Patented and unpatented technologies |  |  | 1,090 |
Trademarks and tradenames |  |  | 200 |
Non-compete agreement |  |  | 50 |
Customer relationships |  |  | 2,830 |
Goodwill |  |  | 16,075 |
Current liabilities |  |  | (540 | )
|  | $ | 24,340 |
Included in U.S. Sensor ’s current assets, net was approximately $1.5 million of receivables. All U.S. Sensor goodwill, other assets and liabilities were recorded in the Electronics segment and reflected in the United States geographic area. The goodwill resulting from this acquisition consists largely of the Company’s expected future product sales and synergies from combining U.S. Sensor’s products and technology with the Company’s existing electronics product portfolio. Goodwill for the above acquisition is expected to be deductible for tax purposes. As required by purchase accounting rules, the Company recorded a $1.6 million step-up of inventory to its fair value as of the acquisition date based on the preliminary valuation. The step-up was amortized as a non-cash charge to cost of goods sold during the third quarter of 2017, as the acquired inventory was sold, and reflected as other non-segment costs. Monolith In December 2015, the Company invested $3.5 million in the preferred stock of Monolith Semiconductor Inc. ( “Monolith”), a U.S. start-up Company developing silicon carbide technology, which represented approximately 12% of the common stock of Monolith on an as-converted basis. The Company accounted for its investment in Monolith under the cost method with any changes in value recorded in other comprehensive income. The value of the Monolith investment was $3.5 million at December 31, 2016. On February 28, 2017, pursuant to a Securities Purchase Agreement between the Company and the stockholders of Monolith and conditioned on Monolith achieving a product development milestone and other provisions, the Company acquired approximately 62% of the outstanding common stock of Monolith for $15 million. The Securities Purchase Agreement includes provisions whereby the Company will acquire the remaining outstanding stock of Monolith (“non-controlling interest”) at a time or times based on Monolith meeting certain technical and sales targets. Consideration for the additional investment(s) will range from $1.0 million to $10 million and will be paid no later than June 30, 2019. The additional investment resulted in the Company gaining control of Monolith and was accounted for as a step-acquisition with the fair value of the original investment immediately before the acquisition estimated to be approximately $3.5 million. As the fair value of the investment immediately prior to the transaction equaled the carrying value, there was no impact on the Company’s Consolidated Statements of Net Income. As the Securities Purchase Agreement includes an obligation of the Company to mandatorily redeem the non-controlling interest for cash, the fair value of the non-controlling interest was recognized as a liability on the Company’s Consolidated Balance Sheets. Changes in the fair value of the non-controlling interest are recognized in the Company’s Consolidated Statements of Net Income. Commencing March 1, 2017, Monolith was reflected as a consolidated subsidiary within the Company ’s Consolidated Financial Statements. Had the acquisition occurred as of January 1, 2017, the impact on the Company’s consolidated results of operations would not have been material. The following table summarizes the purchase price allocation of the fair value of assets acquired and liabilities assumed in the Monolith acquisition:
(in thousands) |  | Purchase Price Allocation |
Total purchase consideration: |  |  |  |
Original investment |  | $ | 3,500 |
Cash, net of cash acquired |  |  | 14,172 |
Fair value of commitment to purchase non-controlling interest |  |  | 9,000 |
Total purchase consideration |  | $ | 26,672 |
Allocation of consideration to assets acquired and liabilities assumed: |  |  |  |
Current assets, net |  | $ | 891 |
Property, plant, and equipment |  |  | 789 |
Patented and unpatented technologies |  |  | 6,720 |
Non-compete agreement |  |  | 140 |
Goodwill |  |  | 20,641 |
Current liabilities |  |  | (639 | )
Other non-current liabilities |  |  | (1,870 | )
|  | $ | 26,672 |
Included in Monolith ’s current assets, net was approximately $0.7 million of receivables. All Monolith goodwill, other assets and liabilities were recorded in the Electronics segment and reflected in the United States geographic area. The goodwill resulting from this acquisition consists largely of the Company’s expected future product sales and synergies from combining Monolith’s products and technology with the Company’s existing electronics product portfolio. Goodwill for the above acquisition is not expected to be deductible for tax purposes. 2016 Acquisitions ON Portfolio On August 29, 2016, the Company acquired certain assets of select businesses (the “ON Portfolio”) of ON Semiconductor Corporation for $104.0 million. The Company funded the acquisition with available cash and proceeds from its credit facility . The acquired business, which is included in the Electronics segment, consists of a product portfolio that includes transient voltage suppression (“TVS”) diodes, switching thyristors and insulated gate bipolar transistors (“IGBTs”) for automotive ignition applications. The acquisition expands the Company’s offerings in power semiconductor applications as well as increases its presence in the automotive electronics market. The ON Portfolio products have strong synergies with the Company’s existing circuit protection business and will strengthen its channel partnerships and customer engagement. The following table summarizes the purchase price allocation of the fair value of assets acquired and liabilities assumed in the ON Portfolio acquisition:
(in thousands) |  | Purcha se Price Allocation |
Total purchase consideration: |  |  |  |
Cash |  | $ | 104,000 |
Allocation of consideration to assets acquired and liabilities assumed: |  |  |  |
Current assets, net |  | $ | 4,816 |
Customer relationships |  |  | 31,800 |
Patented and unpatented technologies |  |  | 8,800 |
Non-compete agreement |  |  | 2,500 |
Goodwill |  |  | 56,084 |
|  | $ | 104,000 |
All the ON Portfolio business goodwill and other assets were recorded in the Electronics segment and are reflected in the Americas and Europe geographic areas. The customer relationships are being amortized over 13.5 years. The patented and unpatented technologies are being amortized over 6 - 8.5 years. The non-compete agreement is being amortized over 4 years. The goodwill resulting from this acquisition consists largely of the Company’s expected future product sales and synergies from combining the ON Portfolio products with the Company’s existing power semiconductor product portfolio. $7.3 million of goodwill for the above acquisition is expected to be deductible for tax purposes. As required by purchase accounting rules, the Company recorded a $0.7 million step-up of inventory to its fair value as of the acquisition date based on the preliminary valuation. All of the step-up was amortized as a non-cash charge to cost of goods sold during 2016, as the acquired inventory was sold, and reflected as other non-segment costs. Included in the Company’s Consolidated Statements of Net Income for the year ended December 31, 2016 are net sales of approximately $21.8 million since the August 29, 2016 acquisition of the ON Portfolio business. Menber ’s On April 4, 2016, the Company completed the acquisition of Menber’s S.p.A. (“Menber’s”) headquartered in Legnago, Italy for $19.2 million, net of acquired cash and after settlement of a working capital adjustment. The Company funded the acquisition with cash on hand and borrowings under the Company’s revolving credit facility. The acquired business is part of the Company's commercial vehicle product business within the Automotive segment and specializes in the design, manufacturing, and selling of manual and electrical high current switches and trailer connectors for commercial vehicles. The acquisition expands the Company’s commercial vehicle products business globally. The following table summarizes the preliminary purchase price allocation of the fair value of assets acquired and liabilities assumed in the Menber’s acquisition:
(in thousands) |  | Purchase Price Allocation |
Total purchase consideration: |  |  |  |
Cash, net of acquired cash |  | $ | 19,162 |
Preliminary allocation of consideration to assets acquired and liabilities assumed: |  |  |  |
Current assets, net |  | $ | 12,919 |
Property, plant, and equipment |  |  | 1,693 |
Customer relationships |  |  | 3,050 |
Patented and unpatented technologies |  |  | 224 |
Trademarks and tradenames |  |  | 1,849 |
Goodwill |  |  | 8,091 |
Current liabilities |  |  | (7,220 | )
Other non-current liabilities |  |  | (1,444 | )
|  | $ | 19,162 |
All Menber ’s goodwill and other assets and liabilities were recorded in the Automotive segment and reflected in the Europe geographic area. The customer relationships are being amortized over 10 years. The patented and unpatented technologies are being amortized over 5 years. The trademarks and tradenames are being amortized over 10 years. The goodwill resulting from this acquisition consists largely of the Company’s expected future product sales and synergies from combining Menber’s products with the Company’s existing automotive product portfolio. Goodwill for the above acquisition is not expected to be deductible for tax purposes. As required by purchase accounting rules, the Company recorded a $0.2 million step-up of inventory to its fair value as of the acquisition date based on the preliminary valuation. The step-up was amortized as a non-cash charge to cost of goods sold during 2016, as the acquired inventory was sold, with the charge reflected as other non-segment costs. Included in the Company’s Consolidated Statements of Net Income for the year ended December 31, 2016 are net sales of approximately $17.3 million since the April 4, 2016 acquisition of Menber’s. PolySwitch On March 25, 2016, the Company acquired 100% of the circuit protection business (“PolySwitch”) of TE Connectivity Ltd. for $348.3 million, net of acquired cash and after settlement of certain post-closing adjustments. The Company funded the acquisition with available cash on hand and borrowings under the Company’s revolving credit facility. The PolySwitch business, which is split between the Automotive and Electronics segments, has a leading position in polymer based resettable circuit protection devices, with a strong global presence in the automotive, battery, industrial, communications and mobile computing markets. PolySwitch has manufacturing facilities in Shanghai and Kunshan, China and Tsukuba, Japan. The acquisition allows the Company to strengthen its global circuit protection product portfolio, as well as strengthen its presence in the automotive electronics and battery end markets. The acquisition also significantly increases the Company’s presence in Japan. The following table summarizes the purchase price allocation of the fair value of assets acquired and liabilities assumed in the PolySwitch acquisition:
(in thousands) |  | Purchase Price Allocation |
Total purchase consideration: |  |  |  |
Original consideration |  | $ | 350,000 |
Post closing consideration adjustment received |  |  | (1,708 | )
Acquired cash |  |  | (3,810 | )
Acquired cash to be returned to seller |  |  | 3,810 |
Total purchase consideration |  | $ | 348,292 |
Allocation of consideration to assets acquired and liabilities assumed: |  |  |  |
Current assets, net |  | $ | 60,228 |
Property, plant, and equipment |  |  | 51,613 |
Land lease |  |  | 4,290 |
Patented and unpatented technologies |  |  | 56,425 |
Customer relationships |  |  | 39,720 |
Goodwill |  |  | 165,088 |
Other long-term assets |  |  | 11,228 |
Current liabilities |  |  | (35,280 | )
Other non-current liabilities |  |  | (5,020 | )
|  | $ | 348,292 |
All PolySwitch goodwill and other assets and liabilities were recorded in the Electronics and Automotive segments and reflected in all geographic areas. The customer relationships are being amortized over 15 years. The patented and unpatented technologies are being amortized over 10 years. The goodwill resulting from this acquisition consists largely of the Company’s expected future product sales and synergies from combining PolySwitch products with the Company’s existing automotive and electronics product portfolio. $103.8 million and $61.3 million of the goodwill for the above acquisition has been assigned to the Electronics and Automotive segments, respectively, with $64.9 million expected to be deductible for tax purposes. As required by purchase accounting rules, the Company recorded a $6.9 million step-up of inventory to its fair value as of the acquisition date based on the preliminary valuation. The step-up was amortized as a non-cash charge to cost of goods sold during the second quarter of 2016, as the acquired inventory was sold, and reflected as other non-segment costs. Included in the Company’s Consolidated Statements of Net Income for the year ended December 31, 2016 are net sales of approximately $126.5 million since the March 25, 2016 acquisition of PolySwitch. 2016 Dispositions During the first quarter of 2016, the Company sold its tangible and intangible assets relating to a marine product line that it acquired as part of its acquisition of Selco A/S in 2011. In connection with this sale, the Company recorded a loss on sale of the product line of $1.4 million reflected within selling, general, and administrative expenses for the year ended December 31, 2016. This loss was recognized as an “other” charge for segment reporting purposes. 2015 Acquisitions Sigmar S.r.l On October 1, 2015, the Company acquired 100% of Sigmar S.r.l. (“Sigmar”). The total purchase price for Sigmar was $6.5 million, net of cash acquired and including estimated additional net payments of up to $0.9 million, a portion of which is subject to the achievement of certain milestones. Located in Ozegna, Italy, Sigmar is a leading global manufacturer of water-in-fuel sensors and also manufactures selective catalytic reduction ( “SCR”) quality sensors and diesel fuel heaters for automotive and commercial vehicle applications. The acquisition further expanded the Company’s automotive sensor product line offerings within its Automotive segment. The Company funded the acquisition with available cash. The following table summarizes the purchase price allocation of the fair value of assets acquired and liabilities assumed in the Sigmar acquisition:
(in thousands) |  | Purchase Price Allocation |
Total purchase consideration: |  |  |  |
Cash, net of acquired cash |  | $ | 5,558 |
Estimated additional consideration payable |  |  | 901 |
Total purchase consideration |  | $ | 6,459 |
Allocation of consideration to assets acquired and liabilities assumed: |  |  |  |
Current assets, net |  | $ | 2,519 |
Property, plant, and equipment |  |  | 1,097 |
Goodwill |  |  | 4,084 |
Patents |  |  | 2,845 |
Current liabilities |  |  | (1,518 | )
Other non-current liabilities |  |  | (2,568 | )
|  | $ | 6,459 |
All Sigmar goodwill and other assets and liabilities were recorded in the Automotive segment and reflected in the Europe geographic area. The patents are being amortized over 10 years. The goodwill resulting from this acquisition consists largely of the Company’s expected future product sales and synergies from combining Sigmar’s products with the Company’s existing automotive product offerings. Goodwill for the above acquisition is not expected to be deductible for tax purposes. Pro Forma Results The following table summarizes, on a pro forma basis, the combined results of operations of the Company and the acquired PolySwitch and the ON Portfolio businesses as though the acquisitions had occurred as of December 28, 2014. The Company has not included pro forma results of operations for Menber’s or Sigmar as these results were not material to the Company. The pro forma amounts presented are not necessarily indicative of either the actual consolidated results had the PolySwitch or ON Portfolio acquisitions occurred as of December 28, 2014 or of future consolidated operating results.
|  | For the Year Ended |
(in thousands, except per share amounts) |  | 2016 |  |  | 2015 |
Net sales |  | $ | 1,130,645 |  |  | $ | 1,104,838 |
Income before income taxes |  |  | 143,110 |  |  |  | 120,370 |
Net income |  |  | 124,388 |  |  |  | 92,983 |
Net income per share — basic |  |  | 5.51 |  |  |  | 4.12 |
Net income per share — diluted |  |  | 5.47 |  |  |  | 4.09 |
Pro forma results presented above primarily reflect: ( i) incremental depreciation relating to fair value adjustments to property, plant, and equipment; (ii) amortization adjustments relating to fair value estimates of intangible assets; (iii) incremental interest expense on assumed indebtedness; and (iv) additional cost of goods sold relating to the capitalization of gross profit as part of purchase accounting recognized for purposes of the pro forma as if it was recognized during the Company’s first quarter of 2015. Pro forma adjustments described above have been tax affected using the Company's effective rate during the respective periods. The historical PolySwitch and ON Portfolio business results for the years ended December 31, 2016 and January 2, 2016 do not include a provision for income taxes. Income tax expense for the historical PolySwitch business was only provided at the end of the business ’s fiscal year ended September 25, 2015. Income tax expense for the historical ON Portfolio business was not provided on a standalone basis.

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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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 Reference 2: 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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