XML 51 R12.htm IDEA: XBRL DOCUMENT

Investments

12 Months Ended

Dec. 31, 2019

Investments [Abstract]

4. Investments

Minda Stoneridge Instruments Ltd.

The Company has a 49% interest in MSIL, a company based in India that manufactures electronics, instrumentation equipment and sensors for the motorcycle, commercial vehicle and automotive markets. The investment is accounted for under the equity method of accounting. The Company’s investment in MSIL, recorded as a component of investments and other long-term assets, net on the consolidated balance sheets, was $12,701 and $11,288 as of December 31, 2019 and 2018, respectively. Equity in earnings of MSIL included in the consolidated statements of operations were $1,578, $2,038 and $1,636 for the years ended December 31, 2019, 2018 and 2017, respectively.

PST Eletrônica Ltda.

The Company had a 74% controlling interest in Stoneridge Brazil from December 21, 2011 through May 15, 2017. On May 16, 2017, the Company acquired the remaining 26% noncontrolling interest in Stoneridge Brazil for $1,500 in cash along with earn-out consideration. The Company will be required to pay additional earn-out consideration, which is not capped, based on Stoneridge Brazil’s financial performance in either 2020 or 2021. See Note 10 for the fair value and foreign currency adjustments of the earn-out consideration for the current and prior periods. The transaction was accounted for as an equity transaction, and therefore no gain or loss was recognized in the statement of operations or comprehensive income. The noncontrolling interest balance on the May 16, 2017 acquisition date was $14,458, of which $31,453 and ($16,995) was related to the carrying value of the investment and foreign currency translation, respectively, and accordingly these amounts were reclassified to additional paid-in capital and accumulated other comprehensive loss, respectively.

The following table sets forth a summary of the changes in noncontrolling interest:



Year ended December 31		2017
Noncontrolling interest at beginning of period		$	13,762
Net loss			(130)
Foreign currency translation			826
Comprehensive income			696
Acquisition of noncontrolling interest			(14,458)
Noncontrolling interest at end of period		$	-

Stoneridge Brazil has dividends payable to former noncontrolling interest holders of Brazilian real (“R$”) 24,154 ($6,010) and R$23,204 ($5,980) as of December 31, 2019 and 2018, respectively. The dividends payable balance includes monetary correction of R$3,703 ($921) and R$2,752 ($709) as of December 31, 2019 and 2018, respectively, based on the Brazilian National Extended Consumer Price inflation index (“IPCA”). The dividend payable related to Stoneridge Brazil was recorded within other current liabilities on the consolidated balance sheet as of December 31, 2019 and 2018. These dividends were paid in January 2020.

Other Investments

In December 2018, the Company entered into an agreement to make a $10,000 investment in a fund managed by Autotech Ventures (“Autotech”), a venture capital firm focused on ground transportation technology which is accounted for in accordance with ASU 2016-01, “Financial Instruments – Overall (Subtopic 825-19).” This investment does not have a readily determinable fair value and is measured at cost, less impairments, adjusted for observable price changes in orderly transactions for identical or similar investments of the same issuer. The Company’s $10,000 investment in the Autotech fund will be contributed over the expected ten year life of the fund. The Company contributed $1,600 and $437 to the Autotech Ventures fund during the years ended December 31, 2019 and 2018, respectively. The Autotech investment recorded in investments and other long-term assets in the consolidated balance sheet was $1,827 and $437 as of December 31, 2019 and 2018, respectively.