Restructuring and Other Items

12 Months Ended

Dec. 31, 2011

Restructuring and Other Items [Abstract]

Note 3: Restructuring and Other Items

Restructuring and other items consisted of:

($ in millions)	2011			2010			2009
Restructuring and related charges
Severance and post-employment benefits	$	2.3		$	10.5		$	3.0
Impairments and asset write-offs		-			5.2			5.3
Other restructuring charges		3.0			0.2			0.4
Total restructuring and related charges		5.3			15.9			8.7
Other items:
Special separation benefits		2.9			-			-
Acquisition-related contingencies		(0.2	)		(1.8	)		-
Brazil tax amnesty benefit		-			-			(2.0	)
Foreign exchange losses and other		1.5			1.7			1.8
Total other items		4.2			(0.1	)		(0.2	)
Total restructuring and other items	$	9.5		$	15.8		$	8.5

Restructuring and Related Charges

In December 2010, our Board of Directors approved a restructuring plan designed to reduce our cost structure and improve operating efficiency. The plan involves the 2011 closure of a plant in the United States, a reduction in operations at a manufacturing facility in England, and the elimination of certain operational and administrative functions in other locations. Under this plan, we expect to incur total restructuring and related charges of approximately $22.0 million through the end of 2012, which consist of approximately $17.0 million in cash expenditures for severance and costs associated with the plant closure and fixed asset relocation, and approximately $5.0 million in non-cash asset impairment and disposal charges. During 2011, we incurred charges of $5.3 million related to this plan. During 2010, we incurred charges of $14.5 million, consisting of $10.1 million in severance and post-employment benefits and $4.4 million in asset impairment charges. The balance of the charges related to this plan will be recognized as incurred during 2012.

During 2010, we also incurred $1.4 million in restructuring and related charges in connection with the 2009 restructuring program, including $0.4 million in employee severance and post-employment benefits, $0.8 million in asset disposal charges and $0.2 million in other exit costs. We incurred a total of $9.0 million in restructuring and related charges, as part of this plan, through its completion in 2010.

During 2009, we incurred $7.6 million in restructuring and related charges related to the 2009 plan. Also in 2009, we incurred $1.1 million in restructuring costs, consisting mainly of employee severance benefits, asset impairments and accelerated depreciation associated with the completion of a 2007 restructuring plan for our former Tech Group segment.

The following table presents activity related to our restructuring obligations recorded within other current liabilities:

($ in millions)	Severance and benefits			Other Costs			Total
Balance, December 31, 2009	$	1.9		$	0.1		$	2.0
Charges		10.4			0.2			10.6
Cash payments		(2.1	)		(0.3	)		(2.4	)
Balance, December 31, 2010		10.2			-			10.2
Charges		2.3			3.0			5.3
Cash payments		(6.3	)		(2.6	)		(8.9	)
Non-cash adjustment		-			0.2			0.2
Balance, December 31, 2011	$	6.2		$	0.6		$	6.8

During the third quarter of 2011, as a result of the closure of a plant in Montgomery, Pennsylvania, we recorded a $0.2 million net curtailment gain related to our U.S. qualified and postretirement medical plans.

Other Items

During 2011, we incurred $2.9 million in special separation benefits related to the retirement of our former President and Chief Operating Officer. These costs consisted primarily of stock-based compensation expense and a settlement loss related to one of our non-qualified defined benefit pension plans. The respective equity compensation arrangements were amended to allow certain of his awards to continue to vest over the original vesting period instead of being forfeited upon separation, resulting in a revaluation of the awards and acceleration of expense.

As discussed in Note 2, Acquisitions, the purchase price in the 2009 acquisition of the éris safety syringe system included contingent consideration with an initial fair value of $2.6 million, which was recorded as a liability at the acquisition date. During 2011 and 2010, we reduced this liability for contingent consideration by $0.8 million and $1.8 million, respectively, bringing the liability balance to zero. This reduction reflects our assessment that none of the contractual operating targets will be achieved over the earnout period, which ends in 2014. During 2011, we also increased the liability for contingent consideration related to our 2010 acquisition of technology used in our SmartDose electronic patch injector system by $0.5 million.

In 2009, we enrolled in a tax amnesty program in Brazil which provided for reduced penalties and interest on certain tax-related obligations. We recognized a pre-tax benefit of $2.0 million in 2009 relating to our participation in this program. In addition, in 2009, we determined that a cost-basis investment was impaired and recorded an $0.8 million charge to write-off the investment, which was recorded within foreign exchange losses and other.