XML 30 R15.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Acquisitions | 12 Months Ended
--- | ---
Dec. 30, 2023
Business Combinations [Abstract] |
Acquisitions | 4. Acquisitions ASSA Businesses In June 2023, we acquired the Emtek and Schaub premium and luxury door and cabinet hardware business (the "Emtek and Schaub Business") and the U.S. and Canadian Yale and August residential smart locks business (the "Yale and August Business", and, collectively with the Emtek and Schaub Business, the "ASSA Businesses") from ASSA ABLOY, Inc. and its affiliates ("ASSA"). The Company completed the acquisition for a total purchase price of approximately $809.3 million, subject to post-closing adjustments, net of cash acquired of $16.3 million. As of the date of this filing, legal title to international operations in Vietnam has not yet transferred, but we expect a deferred closing, which will include a payment of approximately $23.5 million (which amount is already included in the overall purchase price but for which the cash payment has not yet been made) shortly following receipt of local regulatory approval. In preparation for the deferred closing, $23.5 million is classified as restricted cash within Other current assets and the corresponding payable is included within Other current liabilities. We financed the transaction with cash on hand. The results of the Emtek and Schaub Business are reported as part of the Water segment, and the results of the Yale and August Business are reported as part of the Security segment. We incurred $19.7 million of ASSA acquisition-related transaction costs in the year ended December 30, 2023. The following table summarizes the preliminary allocation of the ASSA Businesses' purchase price to the fair value of assets acquired and liabilities assumed as of the date of the acquisition.
(In millions) |
Accounts receivable |  | $ | 38.0 |
Inventories |  |  | 106.8 |
Property, plant and equipment |  |  | 19.5 |
Goodwill |  |  | 258.8 |
Identifiable intangible assets |  |  | 442.0 |
Operating lease assets |  |  | 17.1 |
Other assets |  |  | 2.3 |
Total assets |  |  | 884.5 |
Accounts payable |  |  | 26.0 |
Other current liabilities and accruals |  |  | 33.9 |
Other non-current liabilities |  |  | 15.3 |
Net assets acquired |  | $ | 809.3 |
We apply significant judgment in determining the estimates and assumptions used to determine the fair value of the identifiable intangible assets, including forecasted revenue growth rates, EBIT margins, percentage of revenue attributable to the tradenames, contributory asset charges, customer attrition rate, market-participant discount rates and the assumed royalty rates. Any change in the acquisition date fair value of the acquired assets and liabilities will change the amount of the purchase price allocable to goodwill. Goodwill includes expected sales and cost synergies. The goodwill of $229.1 million and $29.7 million is included in our Water and Security segments, respectively. Substantially all of the tax goodwill is expected to be deductible for income tax purposes, sub ject to the finalization of the purchase price allocation. ASSA Businesses identifiable intangible assets consist of two finite-lived customer relationship assets o f $328.0 million and $21.3 million and indefinite-lived tradename of $75.0 million, a definite-lived tradename o f $9.0 million a nd definite-lived proprietary technology assets of $8.7 million. The useful lives of both of the custome r relationship assets is estimated to be 17 years. The useful life of the definite-lived tradename is estimated to be 30 years. The useful life of the proprietary technology assets is estimated to be eight years. Customer relationshi ps, tradenames and proprietary technology assets are amortized on a straight line basis over their useful lives. The following unaudited pro forma summary presents consolidated financial information as if the ASSA Businesses had been acquired on January 1, 2022. The unaudited pro forma financial information is based on historical results of operations and financial position of the Company and the ASSA Businesses. The pro forma results include: • estimated amortization of finite-lived intangible assets, including customer relationships and proprietary technology, • the estimated cost of the inventory adjustment to fair value, • the reclassification of ASSA Businesses transaction costs from 2023 to the first quarter of 2022, • the removal of certain transactions recorded in the historical financial statements of the ASSA Businesses related to assets and activities which were retained by the seller, and • adjustments to conform accounting policies. The unaudited pro forma financial information does not necessarily represent the results that would have occurred had the acquisition occurred on January 1, 2022. In addition, the unaudited pro forma information should not be deemed to be indicative of future results.
(In millions) |  |  | 2023 |  |  |  | 2022 |
Net sales |  | $ | 4,811.2 |  |  | $ | 5,129.6 |
Net income |  | $ | 443.1 |  |  | $ | 558.8 |
Aqualisa In July 2022, we acquired 100% of the outstanding equity of Aqualisa for a purchase price of $156.0 million, net of cash acquired of $4.8 million. We financed the transaction using cash on hand and borrowings under our revolving credit facility. The results of Aqualisa are reported as part of the Water segment. We have not included pro forma financial information as the transaction is not material to our condensed consolidated statements of comprehensive income. The fair value allocated to assets acquired and liabilities assumed as of July 29, 2022 was $156.0 million, whic h includes $88.7 millio n of goodwill. Goodwill includes expected sales and cost synergies and is not expected to be deductible for income tax purposes. Solar In January 2022, we acquired 100% of the outstanding equity of Solar for a purchase price of $61.6 million, net of cash acquired of $4.8 million. We financed the transaction using cash on hand and borrowings under our revolving credit facility. The results of Solar are reported as part of the Outdoors segment. We have not included pro forma financial information as the transaction is immaterial to our condensed consolidated statements of comprehensive income. The fair value allocated to assets acquired and liabilities assumed as of January 31, 2022 was $61.6 million, which in cludes $23.3 milli on of goodwill. Goodwill includes expected sales and cost synergies and is expected to be deductible for income tax purposes. Flo Technologies In January 2020, we entered into an agreement to acquire the outstanding shares of Flo Technologies ("Flo") in a multi-phase transaction. As part of this agreement, we acquired a majority of Flo’s outstanding shares during 2020 and entered into a forward contract to purchase all remaining shares of Flo during the first quarter of 2022. On January 30, 2022, we made a final cash payment of $16.7 million to the legacy minority shareholders to acquire such shares which is reflected within Other financing, net in our consolidated statements of cash flows.

X
- 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/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479907/805-20-50-5 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//805/tableOfContent + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration