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Acquisition
 6 Months Ended
Jun. 30, 2013
Business Combinations [Abstract]  
Acquisition

14. Acquisition

 

On February 20, 2013, the Company completed its previously announced acquisition of all of the shares of Robbins & Myers, Inc., a U.S.-based designer and manufacturer of products and systems for the oil and gas industry. Under the merger agreement for this transaction, R&M shareholders received $60.00 in cash for each common share for an aggregate purchase price of $2,375 million, net of cash acquired.

The Company has included the financial results of R&M in its consolidated financial statements as of the date of acquisition with components of the R&M operations included in the Company’s Rig Technology, Petroleum Services & Supplies and Distribution & Transmission segments. The Company believes the acquisition of R&M will advance its strategic goal of providing a broader selection of products and services to its customers.

The following table displays the total preliminary purchase price allocation for the R&M acquisition. The R&M purchase price allocation remains preliminary until the valuation is complete. The table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition. (in millions):

 

Current assets, net of cash acquired

    $ 446   

Property, plant and equipment

      198   

Intangible assets

      969   

Goodwill

      1,538   

Other assets

      25   
  

 

 

  

Total assets acquired

      3,176   
  

 

 

  

Current liabilities

      190   

Deferred taxes

      491   

Other liabilities

      120   
  

 

 

  

Total liabilities

      801   
  

 

 

  

Cash consideration, net of cash acquired

    $ 2,375   
  

 

 

  

The Company has preliminarily allocated $969 million to intangible assets (19 year weighted-average life). The intangible assets are expected to be amortizable and are comprised of: $817 million of customer relationships (20 year weighted-average life), $58 million of trademarks (15 year weighted-average life), and $94 million of other intangible assets (15 year weighted-average life). The amount allocated to goodwill represents the excess of the purchase price over the fair value of the net assets acquired. Goodwill resulting from the R&M acquisition is not expected to be deductible for tax purposes. Pro forma information is not included because the acquired operations would not have materially impacted the Company’s consolidated operating results.