XML 31 R9.htm IDEA: XBRL DOCUMENT v3.2.0.727
Acquisitions
 6 Months Ended
Jun. 30, 2015
Acquisition Disclosure [Abstract]  
Acquisitions Disclosure [Text Block]

4. Acquisitions

The Company completed one acquisition during the six months ended June 30, 2015.

HEKA Elektronik

On January 8, 2015, the Company, through its wholly-owned Ealing Scientific Limited and Multi Channel Systems MCS GmbH subsidiaries, acquired all of the issued and outstanding shares of HEKA Elektronik (“HEKA”) for approximately $5.9 million, or $4.5 million, net of cash acquired. Included in the acquisition of HEKA are: HEKA Electronik Dr. Schulze GmbH, based in Lambrecht, Germany (“HEKA Germany”); HEKA Electronics Incorporated, based in Chester, Nova Scotia, Canada (“HEKA Canada”); and HEKA Instruments Incorporated, based in Bellmore, New York. The Company funded the acquisition from its existing cash balances.

HEKA is a developer, manufacturer and marketer of sophisticated electrophysiology instrumentation and software for biomedical and industrial research applications. This acquisition is complementary to the electrophysiology line currently offered by the Company’s wholly-owned Warner Instruments and MCS subsidiaries.

The aggregate purchase price for this acquisition was preliminarily allocated to tangible and intangible assets acquired as follows:

(in thousands)
Tangible assets$4,165
Liabilities assumed(2,819)
Net assets1,346
Goodwill and intangible assets:
Goodwill2,061
Trade name774
Customer relationships1,627
Developed technology1,338
Non-compete agreements27
Deferred tax liabilities(1,245)
Total goodwill and intangible assets, net of tax4,582
Acquisition purchase price$5,928

The estimated purchase price allocation is preliminary and subject to revision. A valuation of the assets acquired and liabilities assumed is being conducted and the final allocation will be made when completed.

Goodwill recorded as a result of the acquisition of HEKA is not deductible for tax purposes.

The results of operations for HEKA have been included in the Company’s consolidated financial statements from the date of acquisition and are not material.

The following consolidated pro forma information is based on the assumption that the acquisition of HEKA occurred on January 1, 2014. Accordingly, the historical results have been adjusted to reflect amortization expense that would have been recognized on such a pro forma basis. The pro forma information is presented for comparative purposes only and is not necessarily indicative of the financial position or results of operations which would have been reported had we completed the acquisition during these periods or which might be reported in the future.

Three Months EndedSix Months Ended
June 30, 2014June 30, 2014
(in thousands)
Pro Forma
Revenues$28,339$55,612
Net income1,0961,889

The Company completed two acquisitions during 2014.

Multi Channel Systems MCS GmbH

On October 1, 2014, the Company, through its wholly-owned Biochrom Limited subsidiary, acquired all of the issued and outstanding shares of Multi Channel Systems MCS GmbH (“MCS”), which has its principal offices in Germany, for approximately $11.2 million, including a working capital adjustment. The Company funded the acquisition from its existing cash balances.

MCS is a developer, manufacturer and marketer of in vitro and in vivo electrophysiology instrumentation for extracellular recording and stimulation. This acquisition is complementary to the in vitro electrophysiology line currently offered by the Company’s wholly-owned Warner Instruments subsidiary.

The aggregate purchase price for this acquisition was preliminarily allocated to tangible and intangible assets acquired as follows:

(in thousands)
Tangible assets$5,442
Liabilities assumed(1,207)
Net assets4,235
Goodwill and intangible assets:
Goodwill3,745
Trade name1,008
Customer relationships1,204
Developed technology2,452
Non-compete agreements148
Deferred tax liabilities(1,603)
Total goodwill and intangible assets, net of tax6,954
Acquisition purchase price$11,189

Goodwill recorded as a result of the acquisition of MCS is not deductible for tax purposes.

The results of operations for MCS have been included in the Company’s consolidated financial statements from the date of acquisition and are not material.

The following consolidated pro forma information is based on the assumption that the acquisition of MCS occurred on January 1, 2014. Accordingly, the historical results have been adjusted to reflect amortization expense that would have been recognized on such a pro forma basis. The pro forma information is presented for comparative purposes only and is not necessarily indicative of the financial position or results of operations which would have been reported had we completed the acquisition during these periods or which might be reported in the future.

Three Months EndedSix Months Ended
June 30, 2014June 30, 2014
(in thousands)
Pro Forma
Revenues$28,780$56,492
Net income1,1051,906

Triangle BioSystems, Inc.

On October 1, 2014, the Company acquired all of the issued and outstanding shares of Triangle BioSystems, Inc. (“TBSI”), which has its principal offices in North Carolina, for approximately $2.2 million, including a working capital adjustment. The Company funded the acquisition from borrowings under its credit facility.

TBSI is a developer, manufacturer and marketer of wireless neural interface equipment to aid in vivo neuroscience research, especially in the fields of electrophysiology, psychology, neurology and pharmacology. This acquisition is complementary to the behavioral neuroscience lines currently offered by the Company’s wholly-owned Panlab and Coulbourn subsidiaries.

The aggregate purchase price for this acquisition was preliminarily allocated to tangible and intangible assets acquired as follows:

(in thousands)
Tangible assets$1,278
Liabilities assumed(530)
Net assets748
Goodwill and intangible assets:
Goodwill946
Trade name143
Customer relationships308
Developed technology363
Non-compete agreements30
Deferred tax liabilities(325)
Total goodwill and intangible assets, net of tax1,465
Acquisition purchase price$2,213

The results of operations for TBSI have been included in the Company’s consolidated financial statements from the date of acquisition and are not material. The Company considers this acquisition immaterial for the purposes of proforma financial statement disclosures. Goodwill recorded as a result of the acquisition of TBSI is not deductible for tax purposes.

Direct acquisition costs recorded in other expense, net in the Company’s consolidated statements of operations were $0.2 million and $0.8 million for the three and six months ended June 30, 2015, respectively, and $0.2 million for both the three and six months ended June 30, 2014, respectively.