Acquisitions and Divestitures

9 Months Ended

Sep. 30, 2018

Acquisitions

In January 2018, the Company acquired all of the outstanding equity interests of Physicians Care Alliance, LLC and Elta MD Holdings, Inc., professional skin care businesses, for aggregate cash consideration of approximately $730. With these acquisitions, the Company entered the professional skin care category, which complements its existing global personal care businesses and resulted in the recognition of additional goodwill.

During the third quarter of 2018, the Company updated its analysis of the preliminary valuation of the assets and liabilities acquired, which primarily resulted in an increase of $64 to goodwill, a decrease in other intangible assets of $69 and a decrease in deferred income taxes of $5, compared with the estimates recorded in the first quarter of 2018. The impact of the change to the preliminary estimates was not material to the Company’s results of operations. As a result, the total purchase price consideration of $730 has been allocated to the net assets acquired based on their respective estimated fair values as follows:



Recognized amounts of assets acquired and liabilities assumed:
Inventories	$	8
Other current assets	8
Other intangible assets	369
Goodwill	396
Other current liabilities	(6		)
Deferred income taxes	(45		)
Fair value of net assets acquired	$	730

Based on the Company’s purchase price allocation, other intangible assets acquired primarily include trademarks of $231 with useful lives of 25 years and customer relationships of $133 with useful lives ranging from 12 to 13 years.

Goodwill of $396 was allocated to the North America segment. The Company expects that approximately 45% of the goodwill will be deductible for tax purposes.

Pro forma results of operations have not been presented as the impact on the Company’s Condensed Consolidated Financial Statements is not material.