XML 24 R14.htm IDEA: XBRL DOCUMENT
v3.8.0.1

Discontinued Operations, Divestitures and Acquisitions | 3 Months Ended
--- | ---
Mar. 31, 2018
Discontinued Operations and Disposal Groups [Abstract] |
Discontinued Operations, Divestitures and Acquisitions | Discontinued Operations, Divestitures and Acquisitions Discontinued Operations On March 25, 2017, we entered into a definitive agreement to sell our Diversey Care division and the food hygiene and cleaning business within our Food Care division for gross proceeds of USD equivalent of $3.2 billion, subject to customary closing conditions. The transaction was completed on September 6, 2017. During 2018, we recorded an additional net gain on the sale of Diversey of $7.4 million, net of taxes. We have classified the operating results from this business, together with certain costs related to the divestiture transaction, as discontinued operations, net of tax, in the Condensed Consolidated Statements of Operations for the three months ended March 31, 2018 and 2017. Summary operating results of Diversey were as follows:
|  | Three Months Ended March 31,
(In millions) |  | 2017
Net sales |  | $ | 581.7 |
Cost of sales |  | 330.5 |
Gross profit |  | 251.2 |
Selling, general and administrative expenses |  | 198.9 |
Amortization expense of intangible assets acquired |  | 17.7 |
Operating profit |  | 34.6 |
Other expense, net |  | (2.9 | )
Earnings from discontinued operations before income tax provision(1) |  | 31.7 |
Income tax provision from discontinued operations |  | 21.2 |
Net earnings from discontinued operations |  | $ | 10.5 |
(1) | For the three months ended March 31, 2017, net earnings from discontinued operations was impacted by a tax expense of $19.5 million related to a change in the repatriation strategy of foreign earnings.
The following table presents selected financial information regarding cash flows of Diversey that are included within discontinued operations in the Condensed Consolidated Statements of Cash Flows:
|  | Three Months Ended March 31,
(In millions) |  | 2017
Non-cash items included in net earnings from discontinued operations: |  |  |
Depreciation and amortization |  | $ | 23.4 |
Share-based incentive compensation |  | 3.3 |
Profit sharing expense |  | 1.0 |
Provision for bad debt |  | 1.3 |
Capital expenditures |  | 3.4 |
The amounts disclosed in the tables above have been excluded from the Notes to Condensed Consolidated Financial Statements unless otherwise noted. Divestitures Divestiture of Embalagens Ltda. On August 1, 2017, we entered into an agreement to sell our polystyrene food tray business in Guarulhos, Brazil for a gross purchase price of R$26.9 million (or $8.2 million as of the closing date of March 19, 2018). The purchase price is subject to working capital, cash and debt adjustments. As of March 31, 2018, the Company recognized a net gain on the sale of $1.0 million within other expense, net on the Condensed Consolidated Statement of Operations. Acquisitions Acquisition of Fagerdala On October 2, 2017, the Company acquired Fagerdala Singapore Pte Ltd. ("Fagerdala"), a manufacturer and fabricator of polyethylene foam based in Singapore, to join its Product Care division. We acquired 100% of Fagerdala shares for estimated consideration of S$144.2 million, or $106.2 million, net of cash acquired of $13.3 million, inclusive of purchase price adjustments which will be finalized in 2018. We acquired Fagerdala to leverage its manufacturing footprint in Asia, expertise in foam manufacturing and fabrication, and commercial organization to grow sales in the consumer electronics, medical equipment and devices, automotive, temperature assurance, and e-commerce fulfillment sectors. The following table summarizes the consideration transferred to acquire Fagerdala and the preliminary allocation of the purchase price among the assets acquired and liabilities assumed.
|  | Preliminary Allocation | Measurement Period | Revised Preliminary Allocation
(In millions) |  | As of October 2, 2017 | Adjustments | As of March 31, 2018
Total consideration transferred |  | $106.6 | $(0.4) | $106.2
Assets: |  |  |  |
Cash and cash equivalents |  | $13.3 |  | $13.3
Trade receivables, net |  | 22.4 |  |  | 22.4 |
Inventory, net |  | 10.0 |  |  | 10.0 |
Prepaid expenses and other current assets |  | 8.4 |  |  | 8.4 |
Property and equipment, net |  | 23.3 |  |  | 23.3 |
Intangible assets, net |  | 41.4 |  | 0.7 |  | 42.1 |
Goodwill |  | 39.3 |  | (0.2 | ) | 39.1 |
Assets |  | $158.1 | $0.5 | $158.6
Liabilities: |  |  |  |
Short-term borrowings |  | $14.0 |  | $14.0
Accounts payable |  | 6.9 |  |  | 6.9 |
Other current liabilities |  | 15.1 |  | 0.9 |  | 16.0 |
Long-term debt, less current portion |  | 3.8 |  |  | 3.8 |
Non-current deferred taxes |  | 11.7 |  |  | 11.7 |
Liabilities |  | $51.5 | $0.9 | $52.4
The valuation of property and equipment, net and intangible assets is preliminary. We expect to complete the valuation in the first half of 2018. All of the goodwill is allocated to the Product Care reporting unit. The $42.1 million fair value allocated to definite-lived intangible assets consists primarily of $25.4 million of customer relationships with a useful life of seventeen years, $10.6 million of trademarks and tradenames with a useful life of fifteen years and various acquired technologies of $6.1 million with useful lives of thirteen years. Acquisition of Deltaplam On August 1, 2017, the Food Care division acquired Deltaplam Embalagens Indústria e Comércio Ltda ("Deltaplam"), a family owned and operated Brazilian flexible packaging manufacturer. The preliminary fair value of the consideration transferred was approximately $25.8 million. We recorded the fair value of the assets acquired and liabilities assumed on the acquisition date, which included $8.1 million of goodwill and $7.4 million of intangible assets. As of March 31, 2018, the fair value of the consideration transferred was approximately $25.3 million, which included $9.7 million of goodwill and $5.9 million of intangible assets.

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

X
- 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 No definition available. + Details
Name: | us-gaap_MergersAcquisitionsAndDispositionsDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration