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Acquisitions (Tables)

9 Months Ended

Jul. 01, 2012

Summarization of provisional and final amounts on assets acquired and liabilities at fair value


	Provisional Amounts		Measurement Period Adjustments			Final Amounts
Investments, cash and accrued investment income, including cash acquired of $1,040,470	$	17,705,419	$	—		$	17,705,419
Reinsurance recoverable		929,817		15,246			945,063
Intangible assets (VOBA)		577,163		—			577,163
Deferred tax assets		256,584		(3,912	)		252,672
Other assets		72,801		—			72,801

Total assets acquired		19,541,784		11,334			19,553,118

Contractholder funds and future policy benefits		18,415,022		—			18,415,022
Liability for policy and contract claims		60,400		—			60,400
Note payable		95,000		—			95,000
Other liabilities		475,285		4,070			479,355

Total liabilities assumed		19,045,707		4,070			19,049,777

Net assets acquired		496,077		7,264			503,341
Cash consideration, net of $5,000 re-characterized as expense		345,000		—			345,000

Bargain purchase gain	$	151,077	$	7,264		$	158,341

Company's pro forma results


	Nine Months Ended July 3, 2011
Revenues:
Reported revenues^(a)	$	2,589,241
FGL adjustment^(b)		685,767

Pro forma revenues	$	3,275,008

Net income:
Reported net income^(a)	$	116,473
FGL adjustment^(b)		84,912

Pro forma net income	$	201,385

Basic and diluted net income per common share attributable to controlling interest:
Reported net income per common share	$	0.71
FGL adjustment		0.46

Pro forma net income per common share	$	1.17

(a)

Reported revenues and net income for the nine months ended July 3, 2011 include the actual results of FGL for the approximate three month period subsequent to April 6, 2011. Reported net income also includes the $158,341 non-recurring bargain purchase gain which was recorded as of the FGL Acquisition date, and reflects the retrospective measurement period adjustments disclosed above.

(b)	The FGL adjustments primarily reflect the following pro forma adjustments applied to FGL’s historical results:

•

Reduction in net investment income to reflect amortization of the premium on fixed maturity securities — available-for-sale resulting from the fair value adjustment of these assets;

•

Reversal of amortization associated with the elimination of FGL’s historical DAC;

•

Amortization of VOBA associated with the establishment of VOBA arising from the acquisition;

•

Adjustments to reflect the impacts of the recapture of the life business from an affiliate of OMGUK and the retrocession of the majority of the recaptured business and the reinsurance of certain life business previously not reinsured to an unaffiliated third party reinsurer, including the amortization of a related $13,750 reserve credit facility structuring fee;

•

Adjustments to eliminate interest expense on notes payable to seller and add interest expense on a new $95,000 surplus note payable (which was subsequently settled in October 2011); and

•

Adjustments to reflect the full-period effect of interest expense on the initial $350,000 of 10.625% Notes issued on November 15, 2010, the proceeds of which were used to fund the FGL Acquisition.

Summary of acquisition and integration related charges incurred


	Three Month Period Ended				Nine Month Period Ended
	July 1, 2012		July 3, 2011		July 1, 2012		July 3, 2011
SB/RH Merger
Integration costs	$	1,573	$	6,718	$	6,766	$	22,088
Employee termination charges		840		310		3,356		5,206
Legal and professional fees		587		360		1,508		3,949

		3,000		7,388		11,630		31,243
FGL		—		1,945		—		22,738
Spectrum Brands		—		104		—		1,055
FURminator		1,738		—		6,337		—
BlackFlag		95		—		1,912		—
Other		657		880		3,056		2,484

Total acquisition and integration related charges	$	5,490	$	10,317	$	22,935	$	57,520

- Definition

Tabular disclosure of pro forma results of operations for a material business acquisition or series of individually immaterial business acquisitions that are material in the aggregate.

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