Merger of FMC Technologies and Technip (Tables)

9 Months Ended

Sep. 30, 2017

Schedule of Business Acquisitions by Acquisition, Equity Interest Issued or Issuable

The acquisition-date fair value of the consideration transferred consisted of the following:



(In millions, except per share data)
Total FMC Technologies, Inc. shares subject to exchange as of January 16, 2017	228.9
FMC Technologies, Inc. exchange ratio ⁽¹⁾	0.5
Shares of TechnipFMC issued	114.4
Value per share of Technip as of January 16, 2017 ⁽²⁾	$	71.4
Total purchase consideration	$	8,170.7

_______________________

⁽¹⁾

As the calculation is deemed to reflect a share capital increase of the accounting acquirer, the FMC Technologies exchange ratio (1 share of TechnipFMC for 1 share of FMC Technologies as provided in the business combination agreement) is adjusted by dividing the FMC Technologies exchange ratio by the Technip exchange ratio (2 shares of TechnipFMC for 1 share of Technip as provided in the business combination agreement), i.e., 1 ⁄ 2 = 0.5 in order to reflect the number of shares of Technip that FMC Technologies stockholders would have received if Technip was to have issued its own shares.


⁽²⁾	Closing price of Technip’s ordinary shares on Euronext Paris on January 16, 2017 in Euro converted at the Euro to U.S. dollar exchange rate of $1.0594 on January 16, 2017.

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table summarizes the preliminary fair values of the assets acquired and liabilities assumed at the acquisition date. The purchase price allocation is subject to revision as additional information about fair value of assets and liabilities becomes available. Additional information that existed as of the acquisition date but at that time was unknown to us may become known during the remainder of the measurement period. As part of the ongoing review of the purchase price allocation, a $210.0 million adjustment to deferred tax balances was recorded during the third quarter of 2017 which reduced goodwill. This adjustment had no impact to the consolidated statements of income.

The final purchase price allocation will be based on final appraisals and other analysis of fair values of acquired assets and liabilities.



(In millions)
Assets:
Cash	$	1,479.2
Accounts receivable	1,247.4
Inventory	764.8
Income taxes receivable	139.2
Other current assets	282.2
Property, plant and equipment	1,293.3
Intangible assets	1,390.3
Deferred income taxes	67.0
Other long-term assets	167.3
Total identifiable assets acquired	6,830.7
Liabilities:
Short-term and current portion of long-term debt	319.5
Accounts payable, trade	386.0
Advance payments	454.0
Income taxes payable	92.1
Other current liabilities	524.3
Long-term debt, less current portion	1,444.2
Accrued pension and other post-retirement benefits, less current portion	195.5
Deferred income taxes	226.8
Other long-term liabilities	138.7
Total liabilities assumed	3,781.1
Net identifiable assets acquired	3,049.6
Goodwill	5,121.1
Net assets acquired	$	8,170.7

Business Combination, Segment Allocation

Goodwill is preliminary due to the draft status of the purchase valuation. The allocation to the reporting segments based on the draft valuation is as follows:



(In millions)	Allocated Goodwill
Subsea	$	2,508.2
Onshore/Offshore	1,622.9
Surface Technologies	990.0
Total	$	5,121.1

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination

The identifiable intangible assets acquired include the following:



(In millions, except estimated useful lives)	Fair Value		Estimated Useful Lives
Acquired technology	$	240.0	10
Backlog	175.0		2
Customer relationships	285.0		10
Tradenames	635.0		20
Software	55.3		Various
Total identifiable intangible assets acquired	$	1,390.3

Business Acquisition, Pro Forma Information

The following unaudited supplemental pro forma results present consolidated information as if the Merger had been completed as of January 1, 2016. The pro forma results do not include any potential synergies, cost savings or other expected benefits of the Merger. Accordingly, the pro forma results should not be considered indicative of the results that would have occurred if the Merger had been consummated as of January 1, 2016, nor are they indicative of future results. For comparative purposes, the weighted average shares outstanding used for the diluted earnings per share calculation for the three and nine months ended September 30, 2017 was also used to calculate the diluted earnings per share for the three and nine months ended September 30, 2016.



	Three Months Ended September 30,				Nine Months Ended September 30,
(In millions, except per share data)	2017 Actual		2016 Pro Forma		2017 Pro Forma		2016 Pro Forma
Revenue	$	4,140.9	$	3,454.8	$	11,486.8	$	10,587.2
Net income attributable to TechnipFMC adjusted for dilutive effects	$	121.0	$	306.9	$	182.4	$	436.1
Diluted earnings per share	$	0.26	$	0.65	$	0.39	$	0.93