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DISCONTINUED OPERATIONS AND ASSETS AND LIABILITIES HELD FOR SALE | 9 Months Ended
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Sep. 30, 2019
Discontinued Operations and Disposal Groups [Abstract] |
DISCONTINUED OPERATIONS AND ASSETS AND LIABILITIES HELD FOR SALE | DISCONTINUED OPERATIONS AND ASSETS AND LIABILITIES HELD FOR SALE MOBILE CRANES On July 31, 2019, the Company completed the previously announced disposition of Demag to Tadano pursuant to the terms of the Asset and Stock Purchase Agreement between the Company and Tadano, dated February 22, 2019. The Company received approximately $215 million of consideration, as adjusted for estimated amounts of cash, debt, working capital and certain other items. The final consideration will be adjusted based on the actual amounts of cash, debt and working capital. Products divested are Demag® all terrain cranes and large lattice boom crawler cranes. During the nine months ended September 30, 2019, the Company recognized a charge of approximately $82 million, net of tax, to write-down Demag to its fair value, less costs to sell. During the three and nine months ended September 30, 2019, the Company recorded a loss on disposition of discontinued operations, net of tax, of $20.9 million. The Company’s actions to sell Demag and cease manufacturing mobile crane product lines in its Oklahoma City facility represent a significant strategic shift in its business away from mobile cranes as these businesses constituted a significant part of its operations and financial results. The Company believes these actions were necessary as it continues to execute its Focus, Simplify and Execute to Win strategy as further described in Part I, Item 1. “Business” included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. In connection with the disposition of Demag, the Company and Tadano entered into certain ancillary agreements, including a Transition Services Agreement (“TSA”), dated as of July 31, 2019, under which the parties will provide one another certain transition services to facilitate the separation of Demag from the Company. Agreements covered under the TSA are generally 12 months or less in duration but certain agreements extend for 36 months. Fees related to these agreements are for reimbursement of services provided. In addition to selling Demag, the Company sold its boom truck, truck crane and crossover product lines and related inventory previously manufactured in its Oklahoma City facility on April 24, 2019. The Company received notes and receivables totaling $27.7 million and recorded a gain, net of tax, of $12.8 million during the nine months ended September 30, 2019. Income (loss) from discontinued operations The following amounts related to discontinued operations were derived from historical financial information and have been segregated from continuing operations and reported as discontinued operations in the Condensed Consolidated Statement of Comprehensive Income (Loss) (in millions):
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2019 |  | 2018 |  | 2019 |  | 2018
Net sales | $ | 67.7 |  |  | $ | 129.6 |  |  | $ | 324.8 |  |  | $ | 423.4 |
Cost of sales | (67.9 | ) |  | (136.9 | ) |  | (330.8 | ) |  | (427.7 | )
Selling, general and administrative expenses | (12.0 | ) |  | (24.9 | ) |  | (73.6 | ) |  | (80.0 | )
Impairment of Mobile Cranes disposal group | — |  |  | — |  |  | (82.1 | ) |  | — |
Other income (expense) | (0.8 | ) |  | (0.8 | ) |  | (4.5 | ) |  | (2.5 | )
Income (loss) from discontinued operations before income taxes | (13.0 | ) |  | (33.0 | ) |  | (166.2 | ) |  | (86.8 | )
(Provision for) benefit from income taxes | 2.9 |  |  | 2.2 |  |  | 14.4 |  |  | 6.6 |
Income (loss) from discontinued operations – net of tax | $ | (10.1 | ) |  | $ | (30.8 | ) |  | $ | (151.8 | ) |  | $ | (80.2 | )
Assets and liabilities held for sale Assets and liabilities held for sale consist of mobile cranes product lines manufactured in Oklahoma City, the Company’s utility hot lines tools business located in South America and Demag, all previously contained in its former Cranes segment. Such assets and liabilities are classified as held for sale upon meeting the requirements of ASC 360 - “Property, Plant and Equipment”, and are recorded at lower of carrying amounts or fair value less costs to sell. Assets are no longer depreciated once classified as held for sale. The following table provides the amounts of assets and liabilities held for sale in the Condensed Consolidated Balance Sheet (in millions):
| September 30, 2019 |  | December 31, 2018
| Cranes |  | Cranes
Assets |  |  |
Cash and cash equivalents | $ | 4.9 |  |  | $ | 32.6 |
Trade receivables – net | 7.9 |  |  | 126.9 |
Inventories | 7.8 |  |  | 295.5 |
Prepaid and other current assets | 0.2 |  |  | 9.4 |
Impairment reserve | (4.6 | ) |  | (4.9 | )
Current assets held for sale | $ | 16.2 |  |  | $ | 459.5 |
Property, plant and equipment – net | $ | 0.5 |  |  | $ | 28.8 |
Intangible assets | 2.3 |  |  | 4.3 |
Impairment reserve | (2.7 | ) |  | (2.9 | )
Other assets | 2.7 |  |  | 38.2 |
Non-current assets held for sale | $ | 2.8 |  |  | $ | 68.4 |
Liabilities |  |  |  |  |
Notes payable and current portion of long-term debt | $ | — |  |  | $ | 0.6 |
Trade accounts payable | 4.8 |  |  | 101.6 |
Accruals and other current liabilities | 3.2 |  |  | 77.3 |
Current liabilities held for sale | $ | 8.0 |  |  | $ | 179.5 |
Long-term debt, less current portion | $ | — |  |  | $ | 4.1 |
Retirement plans and other non-current liabilities | — |  |  | 71.8 |
Non-current liabilities | 1.8 |  |  | 10.6 |
Non-current liabilities held for sale | $ | 1.8 |  |  | $ | 86.5 |
The following table provides amounts of cash and cash equivalents presented in the Condensed Consolidated Statement of Cash Flows (in millions):
| September 30, 2019 |  | December 31, 2018
Cash and cash equivalents: |  |  |
Cash and cash equivalents - continuing operations | $ | 470.6 |  |  | $ | 339.5 |
Cash and cash equivalents - held for sale | 4.9 |  |  | 32.6 |
Total cash and cash equivalents | $ | 475.5 |  |  | $ | 372.1 |
The following table provides supplemental cash flow information related to discontinued operations (in millions):
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2019 |  | 2018 |  | 2019 |  | 2018
Non-cash operating items: |  |  |  |  |  |  |
Depreciation and amortization | $ | 0.1 |  |  | $ | 3.3 |  |  | $ | 3.3 |  |  | $ | 11.1 |
Impairments | $ | — |  |  | $ | — |  |  | $ | 82.1 |  |  | $ | 0.9 |
Deferred taxes | $ | (7.3 | ) |  | $ | (4.1 | ) |  | $ | (5.2 | ) |  | $ | (3.9 | )
Investing activities: |  |  |  |  |  |  |
Capital expenditures | $ | (0.7 | ) |  | $ | (2.9 | ) |  | $ | (3.4 | ) |  | $ | (10.3 | )
Gain (loss) on disposition of discontinued operations - net of tax (in millions):
| Three Months Ended
| September 30,
| 2019 |  | 2018
| Cranes | Material Handling and Port Solutions | Total |  | Material Handling and Port Solutions | Other | Atlas | Total
Gain (loss) on disposition of discontinued operations | $ | (20.8 | ) | $ | — |  | $ | (20.8 | ) |  | $ | (0.2 | ) | $ | — |  | $ | — |  | $ | (0.2 | )
(Provision for) benefit from income taxes | (0.1 | ) | — |  | (0.1 | ) |  | — |  | 0.4 |  | — |  | 0.4 |
Gain (loss) on disposition of discontinued operations – net of tax | $ | (20.9 | ) | $ | — |  | $ | (20.9 | ) |  | $ | (0.2 | ) | $ | 0.4 |  | $ | — |  | $ | 0.2 |
| Nine Months Ended
| September 30,
| 2019 |  | 2018
| Cranes | Material Handling and Port Solutions | Total |  | Material Handling and Port Solutions | Other | Atlas | Total
Gain (loss) on disposition of discontinued operations | $ | (7.1 | ) | $ | (1.3 | ) | $ | (8.4 | ) |  | $ | (0.8 | ) | $ | — |  | $ | 3.2 |  | $ | 2.4 |
(Provision for) benefit from income taxes | (1.0 | ) | (0.1 | ) | (1.1 | ) |  | 0.1 |  | 2.8 |  | (0.5 | ) | 2.4 |
Gain (loss) on disposition of discontinued operations – net of tax | $ | (8.1 | ) | $ | (1.4 | ) | $ | (9.5 | ) |  | $ | (0.7 | ) | $ | 2.8 |  | $ | 2.7 |  | $ | 4.8 |

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- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 + Details
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