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BUSINESS COMBINATIONS | 12 Months Ended
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Sep. 28, 2024
Business Combinations [Abstract] |
BUSINESS COMBINATIONS | Acquisition of Advanced Jet Automation Co., Ltd. On September 8, 2022, the Company through one of its subsidiaries, Kulicke and Soffa Luxembourg S.À R.L, entered into a definitive agreement (the “Definitive Agreement”) for the acquisition of Advanced Jet Automation Co., Ltd. (“AJA”), a technology company headquartered in Taiwan. On February 22, 2023 (the “Closing Date”), pursuant to the Definitive Agreement, the Company completed its acquisition of AJA, including the material business and assets formerly owned by AJA’s affiliate, Samurai Spirit Inc., a leading developer and manufacturer of high-precision micro-dispensing equipment and solutions in Taiwan. AJA became a wholly-owned subsidiary of the Company and on March 30, 2023, AJA was renamed Kulicke and Soffa Hi-Tech Co., Ltd. (“K&S Hi-Tech”). The newly acquired business of K&S Hi-Tech will operate as a business unit (“advanced dispensing solutions”), deemed a separate operating segment which is reported under the “All Others” category. The acquisition broadens the Company’s existing semiconductor, electronic assembly and advanced display portfolio, increasing opportunities across several exciting growth areas including mini and micro-LED, which support both backlighting and direct-emissive approaches. The purchase price consisted of $38.1 million in cash paid at closing (the “Purchase Price”) and additional potential earn-out payments based on certain revenue and earnings before interest, tax, depreciation and amortization (“EBITDA”) benchmarks established for the dispensing business unit. As at September 28, 2024, the Company held $4.0 million in escrow and will continue to hold such sums for a period of twenty-four (24) months from the Closing Date, as security pending the completion of Ruo Chuan Inc.’s obligations as the seller under the Definitive Agreement. On February 22, 2024, the Company finalized the valuation of the tangible and identifiable intangible assets and liabilities in connection with the acquisition of AJA and no further adjustment was recorded. The acquisition of AJA was accounted for in accordance with ASC No. 805, Business Combinations, using the acquisition method. The following table summarizes the allocation of the assets acquired and liabilities assumed based on the fair values as of the acquisition date:
(in thousands) | February 22, 2023
Cash and cash equivalents | $ | 1,238 |
Account and other receivables, net | 1,156 |
Inventory | 1,581 |
Property, plant and equipment | 1,462 |
Right-of-use assets | 989 |
Other assets | 127 |
Goodwill | 27,975 |
Intangible assets | 7,768 |
Accounts and other payables | (965) |
Accrued expenses and other liabilities | (251) |
Contract liabilities | (187) |
Lease liability | (989) |
Deferred tax liabilities | (1,785) |
Total purchase price | $ | 38,119 |
Excluding inventory and property, plant and equipment, all other tangible net assets (liabilities) were valued at their respective carrying amounts, which the Company determined approximate their current fair values at the Closing Date. In connection with the acquisition of AJA, the Company recorded deferred tax liabilities primarily relating to the acquired intangible assets. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired and includes the value of expected future cash flows of AJA from expected synergies with our other affiliates and other unidentifiable intangible assets. None of the goodwill recorded as part of the acquisition will be deductible for income tax purposes. The following table summarizes the fair value, useful life and valuation methodology of each identifiable intangible asset.
(in thousands) | Fair Value | Useful Lives
Developed technology(1) | $ | 4,261 |  | 8
Customer relationships(2) | 2,131 |  | 8
In-process research and development (“IPR&D”)(3) | 459 |  | N.A.
Patents(3) | 524 |  | 8
Order Backlog(4) | 393 |  | 1
Total identifiable intangible assets | $ | 7,768 |  |
(1)The fair value of developed technology was determined using the Relief-from-Royalty Method under the income approach. (2)Customer relationships represent the fair value of the existing relationships using the Multi-Period Excess Earnings Method under the income approach. (3)The fair value of IPR&D and Patents were determined using the Replacement Cost Method, a form of the cost approach. (4)Order backlog represents primarily the fair value of purchase arrangements with customers using the Multi-Period Excess Earnings Method under the income approach. IPR&D is recorded as an indefinite-lived intangible asset and not amortized, but rather is reviewed for impairment on an annual basis or more frequently if indicators of impairment are present, until the project is completed, abandoned, or transferred to a third party. Developed technology, customer relationships, patents and order backlog are amortized using a straight-line method, representing the Company’s best estimate of the distribution of the economic value of the identifiable intangible assets. For fiscal 2023, the acquired dispensing business unit contributed to a net loss of $3.0 million. For fiscal 2023, the Company incurred $0.5 million of expenses related to the acquisition, which is included within selling, general and administrative expense in the Consolidated Statements of Operations. The acquisition did not result in material contributions to revenue and net income in the consolidated financial statements for fiscal 2023. Additionally, pro forma financial information is not provided for consolidated revenue and net income as such amounts attributable to AJA were insignificant to the Company’s consolidated financial statements taken as a whole.

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- 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/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479907/805-20-50-5 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805/tableOfContent + Details
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