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Divestiture-related activities | 9 Months Ended
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Sep. 30, 2012
Divestiture-related activities | Note 16 — Divestiture-related activities When dispositions occur in the normal course of business, gains or losses on the sale of such businesses or assets are recognized in the income statement line item Gain on sales of businesses and assets. In the second quarter of 2012, the Company sold a building, with a net book value of zero, that had been classified as an asset held for sale and realized a gain of approximately $0.3 million. Discontinued Operations The Company has recorded $0.9 million and $1.1 million of expense during the three and nine months ended September 30, 2012, respectively, associated with retained liabilities related to businesses that have been divested. On August 26, 2012, the Company completed the sale of the orthopedic business of its OEM Segment to Tecomet for $45.0 million in cash and realized a loss of $25 thousand, net of tax, from the sale of the business. On December 2, 2011, the Company completed the sale of its business units that design, engineer and manufacture air cargo systems and air cargo containers and pallets to a subsidiary of AAR CORP. for $280.0 million in cash and realized a gain of $126.8 million, net of tax, from the sale. In the second quarter of 2012, the Company received an additional $16.8 million in proceeds as a working capital adjustment pursuant to the terms of the agreement related to the sale of the business, which resulted in recognition of an additional gain on sale of $2.2 million, net of tax. These business units represented the sole remaining businesses in the Company’s former Aerospace Segment. On March 22, 2011, the Company completed the sale of its marine business to an affiliate of H.I.G. Capital, LLC for consideration of $123.1 million (consisting of $103.1 million in cash, plus a subordinated promissory note in the amount of $4.5 million and the assumption by the buyer of approximately $15.5 million in liabilities related to the marine business). Net assets transferred to the buyer in the sale included $1.5 million of cash, resulting in net cash proceeds to the Company of $101.6 million. The Company realized a gain of $57.3 million, net of tax benefits, from the sale of the business. As a result of the disposition, the Company realized accumulated losses from pension and postretirement obligations of approximately $8.4 million and cumulative translation gains of approximately $33.4 million as part of the gain on sale, resulting in a net change of approximately $25.0 million in accumulated other comprehensive income. In September of 2012, the $4.5 million subordinated promissory note plus related accrued interest of $0.7 million was paid by the buyer. The marine business consisted of the Company’s businesses that were engaged in the design, manufacture and distribution of steering and throttle controls and engine and drive assemblies for the recreational marine market, heaters for commercial vehicles and burner units for military field feeding appliances. The marine business represented the sole remaining business in the Company’s former Commercial Segment. The following table presents the operating results of the operations that have been treated as discontinued operations for the periods presented:
|  | Three Months Ended |  |  | Nine Months Ended |
|  | September 30, 2012 |  |  | September 25, 2011 |  |  | September 30, 2012 |  |  | September 25, 2011 |
|  | (Dollars in thousands) |
Net revenues |  | $ | 2,789 |  |  | $ | 66,140 |  |  | $ | 16,616 |  |  | $ | 225,033 |
Costs and other expenses |  |  | 3,582 |  |  |  | 51,548 |  |  |  | 17,093 |  |  |  | 201,593 |
Goodwill impairment(1) |  |  | — |  |  |  | — |  |  |  | 9,700 |  |  |  | — |
Gain (loss) on disposition(2) |  |  | (38 | ) |  |  | (4 | ) |  |  | 2,226 |  |  |  | 52,265 |
Income (loss) from discontinued operations before income taxes |  |  | (831 | ) |  |  | 14,588 |  |  |  | (7,951 | ) |  |  | 75,705 |
Provision for income taxes(3) |  |  | 1,690 |  |  |  | 3,444 |  |  |  | (1,668 | ) |  |  | (3,522 | )
Income (loss) from discontinued operations |  |  | (2,521 | ) |  |  | 11,144 |  |  |  | (6,283 | ) |  |  | 79,227 |
Less: Income from discontinued operations attributable to noncontrolling interest |  |  | — |  |  |  | 125 |  |  |  | — |  |  |  | 443 |
Income (loss) from discontinued operations attributable to common shareholders |  | $ | (2,521 | ) |  | $ | 11,019 |  |  | $ | (6,283 | ) |  | $ | 78,784 |
(1) | During nine months ended September 30, 2012, the Company recognized a non-cash goodwill impairment charge of $9.7 million to adjust the carrying value of the orthopedic business to its estimated fair value.
(2) | The $2.2 million pre-tax gain on disposition during the nine months ended September 30, 2012 primarily reflects the gain recognized on the working capital adjustment related to the sale of the cargo systems and cargo container businesses.
(3) | The provision for income taxes for the three months ended September 30, 2012 was impacted unfavorably by the realization of an expense associated with US matters relating to prior years. In addition to the aforementioned item, the provision for income taxes for the nine months ended September 30, 2012 was impacted favorably by the realization of a tax benefit on impairment of goodwill. The provision for income taxes for the nine months ended September 25, 2011 was impacted favorably by the realization of net tax benefits resulting from the resolution (including the expiration of statutes of limitation) of U.S. federal, state, and foreign tax matters relating to prior years and was further impacted favorably because taxes on the sale of the marine business were incurred at a rate that was significantly lower than the statutory tax rate.
Net assets and liabilities of the discontinued operations sold in 2012 were comprised of the following:
|  | (Dollars in thousands) |
Net assets |  | $ | 46,209 |
Net liabilities |  |  | (1,457 | )
|  | $ | 44,752 |

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- Definition The entire disclosure for the facts and circumstances leading to the completed or expected disposal, manner and timing of disposal, the gain (loss) recognized in the income statement and the income statement caption that includes that gain (loss), amounts of revenues and pretax profit or loss reported in discontinued operations, the segment in which the disposal group was reported, and the classification (whether sold or classified as held for sale) and carrying value of the assets and liabilities comprising the disposal group. Includes all disposal groups, including those classified as components of the entity (discontinued operations). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1474-107760 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1361-107760 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 144 -Paragraph 43-48 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e957-107759 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1436-107760 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6391110&loc=d3e2941-110230 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 45 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=8077374&loc=d3e2443-110228 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e1012-107759 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1510-107760 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e1020-107759 + Details
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