XML 19 R8.htm IDEA: XBRL DOCUMENT
v3.7.0.1

Acquisitions | 6 Months Ended
--- | ---
Jul. 02, 2017
Business Combinations [Abstract] |
Acquisitions | Acquisitions Thinklogical Holdings, LLC We acquired 100% of the outstanding ownership interest in Thinklogical Holdings, LLC (Thinklogical) on May 31, 2017 for cash of $171.3 million. Thinklogical designs, manufactures, and markets high-bandwidth fiber matrix switches, video, and keyboard/video/mouse extender solutions, camera extenders, and console management solutions. Thinklogical is headquartered in Connecticut. The results of Thinklogical have been included in our Consolidated Financial Statements from May 31, 2017, and are reported within the Broadcast Solutions segment. The following table summarizes the estimated fair value of the assets acquired and the liabilities assumed as of May 31, 2017 (in thousands):
Cash |  | $ | 5,327 |
Receivables |  | 4,355 |
Inventory |  | 17,291 |
Prepaid and other current assets |  | 405 |
Property, plant, and equipment |  | 4,289 |
Intangible assets |  | 86,250 |
Goodwill |  | 57,513 |
Total assets acquired |  | $ | 175,430 |
Accounts payable |  | $ | 1,231 |
Accrued liabilities |  | 1,353 |
Deferred revenue |  | 1,574 |
Total liabilities assumed |  | $ | 4,158 |
Net assets |  | $ | 171,272 |
A single estimate of fair value results from a complex series of judgments about future events and uncertainties and relies heavily on estimates and assumptions. The judgments we have used in estimating the fair values assigned to each class of acquired assets and assumed liabilities could materially affect the results of our operations. The fair value of acquired receivables is $4.4 million, which is equivalent to its gross contractual amount. For purposes of the above allocation, we based our estimate of the fair value for the acquired inventory, intangible assets, and deferred revenue on a preliminary valuation study performed by a third party valuation firm. We have estimated a fair value adjustment for inventories based on the estimated selling price of the work-in-process and finished goods acquired at the closing date less the sum of the costs to complete the work-in-process, the costs of disposal, and a reasonable profit allowance for our post acquisition selling efforts. We used various valuation methods including discounted cash flows to estimate the fair value of the identifiable intangible assets and deferred revenue (Level 3 valuation). Goodwill and other intangible assets reflected above were determined to meet the criterion for recognition apart from tangible assets acquired and liabilities assumed. The goodwill is primarily attributable to expected synergies and the assembled workforce. The expected synergies for the Thinklogical acquisition primarily consist of utilizing Belden's fiber and connectivity with Thinklogical's connections between matrix switch, control systems, transmitters and source to expand our product portfolio across our segments to both existing and new customers. Our tax basis in the acquired goodwill is $57.5 million. The goodwill balance we recorded is deductible for tax purposes over a period of 15 years up to the amount of the tax basis. The intangible assets related to the acquisition consisted of the following:
|  | Fair Value |  | Amortization Period
|  | (In thousands) |  | (In years)
Intangible assets subject to amortization: |  |  |  |
Developed technologies |  | $ | 60,000 |  |  | 5.0
Customer relationships |  | 20,000 |  |  | 15.0
Trademarks |  | 3,750 |  |  | 10.0
Sales backlog |  | 2,500 |  |  | 0.3
Total intangible assets subject to amortization |  | $ | 86,250 |  |  |
Intangible assets not subject to amortization: |  |  |  |
Goodwill |  | $ | 57,513 |  |  | n/a
Total intangible assets not subject to amortization |  | $ | 57,513 |  |  |
Total intangible assets |  | $ | 143,763 |  |  |
Weighted average amortization period |  |  |  | 7.4
The amortizable intangible assets reflected in the table above were determined by us to have finite lives. The useful life for the customer relationship intangible asset was based on our forecasts of customer turnover. The useful life for the trademarks was based on the period of time we expect to continue to go to market using the trademarks. The useful life for the developed technology intangible asset was based on the estimated time that the technology provides us with a competitive advantage and thus approximates the period of consumption of the intangible asset. The useful life of the backlog intangible asset was based on our estimate of when the ordered items would ship. Our consolidated revenues and consolidated income before taxes for the three and six months ended July 2, 2017 included $10.2 million of revenues and $1.1 million of income before taxes from Thinklogical. The following table illustrates the unaudited pro forma effect on operating results as if the Thinklogical acquisition had been completed as of January 1, 2016.
|  | Three Months Ended |  | Six Months Ended
|  | July 2, 2017 |  | July 3, 2016 |  | July 2, 2017 |  | July 3, 2016
|  | (In thousands, except per share data)
|  | (Unaudited)
Revenues |  | $ | 615,109 |  |  | $ | 608,517 |  |  | $ | 1,170,745 |  |  | $ | 1,155,428 |
Net income attributable to Belden common stockholders |  | 28,250 |  |  | 38,194 |  |  | 41,130 |  |  | 47,520 |
Diluted income per share attributable to Belden common stockholders |  | $ | 0.66 |  |  | $ | 0.90 |  |  | $ | 0.96 |  |  | $ | 1.12 |
The above unaudited pro forma financial information is presented for informational purposes only and does not purport to represent what our results of operations would have been had we completed the acquisitions on the date assumed, nor is it necessarily indicative of the results that may be expected in future periods. Pro forma adjustments exclude cost savings from any synergies resulting from the acquisition. M2FX We acquired 100% of the shares of M2FX Limited (M2FX) on January 7, 2016 for a purchase price of $19.0 million. M2FX is a manufacturer of fiber optic cable and fiber protective solutions for broadband access and telecommunications networks. M2FX is located in the United Kingdom. The results of M2FX have been included in our Consolidated Financial Statements from January 7, 2016, and are reported within the Broadcast Solutions segment. The M2FX acquisition was not material to our financial position or results of operations.

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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum: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