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Acquisitions and Divestitures | 12 Months Ended
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Dec. 31, 2022
Business Combination and Asset Acquisition [Abstract] |
Acquisitions and Divestitures | Acquisitions and Divestiture On September 27, 2022, the second day of the fourth quarter, we completed the acquisition of Standard Bariatrics, Inc. (“Standard Bariatrics”), a privately-held medical device company that commercialized a powered stapling technology for bariatric surgery that complements our surgical product portfolio. The fair value of consideration transferred was $211.8 million, which included cash payments of $173.0 million and $38.8 million in estimated fair value of contingent consideration. The contingent consideration liability represents the estimated fair value of our obligations, under the acquisition agreement, to make three milestone payments up to $130 million in aggregate if certain commercial milestones are met. The milestone payments are based on net sales growth over the three-year period following the closing of the transaction. The fair value of the contingent consideration was estimated using a Monte Carlo valuation approach. See Note 12 for additional information on the fair value measurement of the contingent consideration. The acquisition was financed using borrowings under our revolving credit facility and cash on hand. The following table presents the fair value of the assets acquired and liabilities assumed with respect to the Standard Bariatrics acquisition:
| (Dollars in thousands)
Assets |
Current assets | $ | 8,028 |
Property, plant and equipment | 3,342 |
Intangible assets | 154,450 |
Goodwill | 71,420 |
Other assets | 2,122 |
Total assets acquired | 239,362 |
Less: |
Current liabilities | 2,661 |
Other liabilities | 24,896 |
Liabilities assumed | 27,557 |
Net assets acquired | $ | 211,805 |
The goodwill resulting from the Standard Bariatrics acquisition primarily reflects synergies currently expected to be realized from the integration of the acquired business and is not tax deductible. The following table sets forth the components of identifiable intangible assets acquired and the ranges of the useful lives as of the date of the Standard Bariatrics acquisition:
| Standard Bariatrics
| Fair value |  | Useful life (years)
Intellectual property | $ | 128,300 |  |  | 15
Trade names | 22,500 |  |  | 25
Customer relationships | 3,650 |  |  | 11
For the year ended December 31, 2022, we incurred $1.3 million in transaction expenses associated with the Standard Bariatrics acquisition, which are included in selling, general and administrative expenses in the consolidated statement of income. Pro forma information for the Standard Bariatrics acquisition is not presented as the operations of Standard Bariatrics are not deemed to be significant to our overall operations. Asset Acquisition On June 13, 2022, we acquired a privately-owned catheter company for an initial cash payment of $22.8 million. Under the terms of the acquisition agreement, we may become obligated to make additional cash payments up to $26.2 million if certain commercial and revenue goals are met. The acquisition, which complements our interventional product portfolio, principally consisted of a proprietary catheter design and other related intellectual property, being amortized over a useful life of 15 years. Divestiture On May 15, 2021, we entered into a definitive agreement to sell certain product lines within our global respiratory product portfolio (the "Divested respiratory business") to Medline Industries, Inc. (“Medline”) for consideration of $286.0 million, reduced by $12.0 million in working capital not transferring to Medline, which is subject to customary post close adjustments (the "Respiratory business divestiture"). In connection with the Respiratory business divestiture, we also entered into several ancillary agreements with Medline to help facilitate the transfer of the business, which provide for transition support, quality, supply and manufacturing services, including a manufacturing and supply transition agreement (the "MSTA"). On June 28, 2021, we completed the initial phase of the Respiratory business divestiture, pursuant to which we received cash proceeds of $259.0 million. The second phase of the Respiratory business divestiture will occur once we transfer certain additional manufacturing assets to Medline. Our receipt of $15.0 million in additional cash proceeds is contingent upon the transfer of these manufacturing assets and is expected to occur prior to the end of 2023. We plan to recognize the contingent consideration, and any gain on sale resulting from the second phase of the divestiture, when it becomes realizable. Net revenues attributable to our divested respiratory business recognized prior to the Respiratory business divestiture are included within each of our geographic segments and were $60.7 million and $138.5 million for the years ended December 31, 2021 and 2020, respectively. Net revenues attributed to services provided to Medline in accordance with the MSTA, which are presented within our Americas reporting segment, were $79.1 million and $51.1 million for the years ended December 31, 2022, and 2021, respectively. Supplemental cash flow information
| Year Ended December 31,
| 2022 |  | 2021 |  | 2020
Non cash investing and financing activities of continuing operations: |  |  |  |  |
Acquisition of businesses | $ | 43,168 |  |  | $ | — |  |  | $ | — |

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