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DISPOSITION OF THE CORE BUSINESS | 9 Months Ended
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Sep. 30, 2018
Discontinued Operations and Disposal Groups [Abstract] |
DISPOSITION OF THE CORE BUSINESS | DISPOSITION OF THE CORE BUSINESS On August 30, 2018, we closed on a previously disclosed definitive asset purchase agreement with Specialty Surgical Instrumentation Inc., a Tennessee Corporation and wholly-owned subsidiary of Symmetry Surgical Inc. (“Symmetry”), pursuant to which the Company divested and sold the Company's electrosurgical "Core" business segment and related intellectual property, including the Bovie® brand and trademarks, to Symmetry for gross proceeds of $97 million in cash. In connection with the asset purchase agreement, we entered into a previously disclosed Electro Surgical Disposables and Accessories, Cauteries and Other Products Supply Agreement with Symmetry for a four-year term, whereby we will manufacture certain Core products and sell them to Symmetry at agreed upon prices. Any revenue, costs and expenses resulting from this agreement are netted and reported in our Consolidated Statements of Operations as Other gains or losses. Additionally, in connection with the asset purchase agreement, we entered into a previously disclosed Manufacture and Supply Agreement with Symmetry for a ten-year term, whereby we will manufacture certain products and sell them to Symmetry at agreed upon prices. Revenue, costs and expenses resulting from this agreement are reported in our Consolidated Statements as income or loss from operations of our OEM reporting segment. We concluded that the divestiture of the Core business met the criteria for discontinued operations set forth in ASC No. 205, Presentation of Financial Statements. The table below summarizes the cash consideration and the carrying values of disposed assets at the disposition date of August 30, 2018 included as part of discontinued operations:
(In thousands) |
Gross consideration from the sale of the Core Business | $ | 97,000 |
Closing and transaction costs | 5,905 |
Net proceeds from sale of the Core Business before taxes | $ | 91,095 |
Book value of the Core Business |
Current assets: |
Inventories, net | 2,195 |
Prepaid expenses and other current assets | 57 |
Total current assets | 2,252 |
Property and equipment, net of depreciation | 375 |
Brand name and trademark | 1,510 |
Purchased technology and license rights, net of depreciation | 112 |
Total non-current assets | 1,997 |
Total assets | $ | 4,249 |
Current liabilities: |
Accrued inventory liability | 2,305 |
Total current liabilities | 2,305 |
Total book value of the Core Business | $ | 6,554 |
Net gain on sale of the Core Business before taxes | 84,541 |
Income tax expense | 15,469 |
Net gain on sale of the Core Business after income taxes | $ | 69,072 |

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: 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 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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