3. ACQUISITIONS

The Corporation continually evaluates potential acquisitions that either strategically fit within the Corporation’s existing portfolio or expand the Corporation’s portfolio into new product lines or adjacent markets. The Corporation has completed a number of acquisitions that have been accounted for as business combinations and have resulted in the recognition of goodwill in the Corporation's financial statements. This goodwill arises because the purchase prices for these businesses reflect the future earnings and cash flow potential in excess of the earnings and cash flows attributable to the current product and customer set at the time of acquisition. Thus, goodwill inherently includes the know-how of the assembled workforce, the ability of the workforce to further improve the technology and product offerings, and the expected cash flows resulting from these efforts. Goodwill may also include expected synergies resulting from the complementary strategic fit these businesses bring to existing operations.

The Corporation allocates the purchase price at the date of acquisition based upon its understanding of the fair value of the acquired assets and assumed liabilities. In the months after closing, as the Corporation obtains additional information about these assets and liabilities, including through tangible and intangible asset appraisals, and as the Corporation learns more about the newly acquired business, it is able to refine the estimates of fair value and more accurately allocate the purchase price. Only items identified as of the acquisition date are considered for subsequent adjustment. The Corporation will make appropriate adjustments to the purchase price allocation prior to completion of the measurement period, as required.

In 2013, the Corporation acquired five businesses for an aggregate purchase price of $236.1 million, all of which are described in more detail below. In 2012, the Corporation acquired eight businesses for an aggregate purchase price of $462.4 million, net of cash acquired, all of which are described in more detail below. In 2011, the Corporation acquired eight businesses for an aggregate purchase of $183.3 million, all of which are described in more detail below.

The amounts of net sales and net loss included in the Corporation’s consolidated statement of earnings from the acquisition date to the period ended December 31, 2013 are $74.0 million and $3.3 million, respectively.

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition for all acquisitions consummated during 2013, 2012, and 2011:



(in thousands)	2013			2012			2011
Accounts receivable	$	25,972		$	53,753		$	19,078
Inventory	30,930			52,225			23,813
Property, plant, and equipment	18,066			40,915			22,526
Other current assets	3,229			7,244			1,182
Intangible assets	102,751			182,681			53,717
Current and non-current liabilities	(19,599		)	(44,617		)	(13,510		)
Pension and postretirement benefits	(6,472		)	(8,144		)	—
Deferred income taxes	(19,920		)	(51,830		)	(2,303		)
Debt assumed	—			(13,819		)	—
Due to seller	(2,856		)	(240		)	—
Net tangible and intangible assets	132,101			218,168			104,503
(Gain on Bargain Purchase)	—			(910		)	—
Purchase price	236,135			462,416			183,328
Goodwill	$	104,034		$	245,158		$	78,825

Supplemental Pro Forma Statements of Operations Data (Unaudited)

The assets, liabilities and results of operations of the businesses acquired in 2011 were not material to the Corporation’s consolidated financial position or results of operations, and therefore pro forma financial information for such business acquisitions is not presented.

The following table presents unaudited consolidated pro forma financial information for the combined results of the Corporation and its completed business acquisitions during the year ended December 31, 2013 and 2012 as if the 2013 acquisitions had occurred on January 1, 2012. Pro forma results were previously disclosed for the 2012 acquisitions as if the 2012 acquisitions had occurred on January 1, 2011, and the 2012 pro forma provided below was prepared using the same assumption.



(In thousands, except per share data)	2013		2012
Net sales	$	2,580,394	$	2,548,727
Net earnings from continuing operations	144,341		99,051
Diluted earnings per share from continuing operations	3.01		2.09

The unaudited pro forma consolidated results were prepared using the acquisition method of accounting and are based on the historical financial information for a 12 month period. The unaudited pro forma consolidated results are not necessarily indicative of what our consolidated results of operations actually would have been had we completed the acquisitions on January 1, 2012. In addition, the unaudited pro forma consolidated results do not purport to project the future results of operations of the combined company nor do they reflect the expected realization of any cost savings associated with the acquisition. The unaudited pro forma consolidated results reflect primarily the following pro forma pre-tax adjustments:


•	Elimination of historical intangible asset amortization expense (approximately $0.7 million and $2.9 million in 2013 and 2012, respectively).


•	Additional amortization expense (approximately $3.7 million and $23.0 million in 2013 and 2012, respectively) related to the fair value of identifiable intangible assets acquired.


•	Additional depreciation expense (approximately $1.3 million and $1.8 million in 2013 and 2012, respectively) related to the fair value adjustment to property, plant and equipment acquired.


•	Elimination of the fair value adjustments to acquisition-date inventory that has been sold in 2013 of $3.7 million, and recognition in 2012 of the full value of the fair value adjustment to acquisition date inventory.


•	Reclassification of $2.1 million of the Corporation’s 2013 acquisition costs directly attributable to the acquisition into 2012. Included in these costs are advisory, investment banking and legal and regulatory costs incurred by the Corporation. The Corporation records acquisition costs in General and administrative expenses.


•	Elimination of historical interest expense (approximately $0.6 million and $6.8 million in 2013 and 2012, respectively).


•	Additional interest expense (approximately $4.3 million and $26.3 million in 2013 and 2012, respectively) associated with the incremental borrowings that would have been incurred to acquire these companies as of January 1, 2012.

FLOW CONTROL

2013 Acquisitions

Ovalpath

On October 1, 2013, the Corporation acquired the assets of Ovalpath, Inc. for $2.3 million in cash. The Asset Purchase Agreement contains representations and warranties customary for a transaction of this type, including a portion of the purchase price held back as security for potential indemnification claims against the seller. The Asset Purchase Agreement also provides for contingent consideration based on achievement of certain sales targets. Based on the estimated amount of sales over the five-year measurement period, the Corporation recorded a liability of the estimated fair value of the contingent consideration in the amount of $1.5 million.

Based in San Jose, CA, Ovalpath has developed a proprietary software platform utilizing mobile technology to enable applications that provide significant efficiencies within a nuclear plant. Ovalpath operates within the Nuclear Group division of the Flow Control segment.

Gulf33 Valve Pros, LLC

On September 16, 2013, the Corporation acquired the assets of Gulf33 Valve Pro, LLC for $3.3 million in cash. The Asset Purchase Agreement contains representations and warranties customary for a transaction of this type, including a portion of the purchase price retained as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation's revolving credit facility.

Based in Louisiana, Gulf33 provides valve repair and maintenance services to the offshore oil and gas market and operates within the Oil and Gas Systems division of the Flow Control segment.

Phönix Group

On February 28, 2013, the Corporation acquired all the outstanding shares of Phönix Holding GmbH for $97.9 million, net of cash acquired. The Share Purchase and Transfer Agreement contains a purchase price adjustment mechanism and representations and warranties customary for a transaction of this type, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation’s revolving credit facility and excess cash at foreign locations.

Phönix, headquartered in Germany, is a designer and manufacturer of valves, valve systems, and related support services to the global chemical, petrochemical and power (both conventional and nuclear) markets. Phönix has 282 employees and operates Phönix Valves in Volkmarsen, Germany; Strack, located in Barleben, Germany; and Daume Control Valves, located in Hanover, Germany. Phönix also owns sales subsidiaries with warehouses in Texas and France.

Revenues of the acquired business were approximately $60.0 million in 2012. The business operates within the Marine & Power Products Division of Curtiss-Wright's Flow Control segment.

The purchase price of the acquisition has been allocated to the net tangible and intangible assets acquired with the remainder recorded as goodwill on the basis of estimated fair values, as follows:



(In thousands)	Phönix			Gulf 33			Ovalpath			Total
Accounts receivable	$	12,226		$	581		$	85		$	12,892
Inventory	20,358			101			—			20,459
Property, plant, and equipment	12,575			269			—			12,844
Other current and non-current assets	2,153			—			—			2,153
Intangible assets	42,791			1,260			600			44,651
Current and non-current liabilities	(7,497		)	(239		)	(18		)	(7,754		)
Pension and postretirement benefits	(6,472		)	—			—			(6,472		)
Deferred income taxes	(14,402		)	—			—			(14,402		)
Due to seller	—			(622		)	(1,750		)
Net tangible and intangible assets	61,732			1,350			(1,083		)	64,371
Purchase price	97,886			3,328			2,250			103,464
Goodwill	$	36,154		$	1,978		$	3,333		$	41,465

Tax deductible goodwill	$	—		$	1,978		$	3,333

2012 Acquisitions

Cimarron Energy

On November 21, 2012, the Corporation acquired Cimarron Energy, Inc. through the acquisition of 100% of the membership interests of Cimarron Energy Holding Company, LLC, for a net cash purchase price of $132.6 million. The Purchase Agreement contains a purchase price adjustment mechanism and representations and warranties customary for a transaction of this type, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation’s revolving credit facility.

Cimarron is a manufacturer of highly customized and engineered energy production, processing, and environmental solutions for the U.S. oil and gas industry. Cimarron has 368 employees and is headquartered in Norman, OK. Revenues of the acquired business were approximately $98 million for the year ended 2011. The business operates within the Oil and Gas Systems division of the Flow Control segment.

A.P. Services, LLC

On November 5, 2012, the Corporation acquired AP Services, LLC, through the acquisition of 100% of the membership interests of A.P. Holdco, LLC, the parent company of the operating entity, for a cash purchase price of $30.4 million. The agreement also contains representations and warranties customary for a transaction of this type, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation’s revolving credit facility.

A.P. Services is a supplier of fluid sealing technologies and services to the nuclear and fossil power generation markets, with proven performance in delivering solutions that improve plant reliability and safety and also reduce operation and maintenance costs. A.P. Services has 84 employees and is based in Freeport, PA. Revenues of the acquired business were approximately $23 million for the year ended 2011. The business operates within the Nuclear Group division of the Flow Control segment.

Other Flow Control

During 2012, the Corporation acquired three product lines in two separate transactions for an aggregate purchase price of approximately $7 million. These product lines serve the commercial nuclear power market and consist of original equipment and re-engineered replacement products for obsolete equipment and product technology supporting steam generators on nuclear reactors. One of the acquisitions resulted in the recognition of a gain on bargain purchase of $0.9 million, as the value of assets acquired of $1.2 million exceeded the purchase price of $0.3 million. The Corporation integrated these product lines within the Nuclear Group division of the Flow Control segment.

The purchase price of the acquisitions has been allocated to the net tangible and intangible assets acquired with the remainder recorded as goodwill on the basis of estimated fair values, as follows:



(In thousands)	AP Services			Cimarron			Other Flow			Total
Accounts receivable	$	2,805		$	21,706		$	—		$	24,511
Inventory	2,389			18,987			236			21,612
Property, plant, and equipment	3,488			8,094			—			11,582
Other current assets	204			618			—			822
Intangible assets	8,000			55,000			4,681			67,681
Current and non-current liabilities	(1,121		)	(21,434		)	(75		)	(22,630		)
Deferred income taxes	(3,064		)	(18,853		)	—			(21,917		)
Due to seller	—			—			(240		)	(240		)
Net tangible and intangible assets	12,701			64,118			4,602			81,421
Gain on bargain purchase	—			—			(910		)	(910		)
Purchase price	30,360			132,581			6,974			170,176
Goodwill	$	17,659		$	68,463		$	3,282		$	89,665

Tax deductible goodwill	$	13,554		$	—		$	3,282

2011 Acquisitions

Anatec International, Inc. and Lambert, MacGill, Thomas, Inc. (LMT)

On December 2, 2011, the Corporation acquired the assets of Anatec International, Inc, and Lambert, MacGill, Thomas, Inc. (Anatec and LMT) for $35.2 million in cash, including a purchase price adjustment of $1.2 million. The Asset Purchase Agreement contains customary representations and warranties, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation’s revolving credit facility. As of December 31, 2012, all funds held in escrow have been released to the seller with no claims outstanding.

Anatec and LMT perform testing and inspection services for commercial nuclear power plants to ensure safety, operational soundness, and compliance with regulatory codes. Anatec and LMT operates within the Nuclear Group division of the Flow Control segment. Anatec and LMT have 50 full-time personnel and manage an additional seasonal workforce of approximately 150 during nuclear plant maintenance outages. Anatec and LMT are headquartered in San Clemente, CA, with four additional facilities to support nuclear plant operations in the U.S. Revenues of the acquired business were approximately $20 million for the year ended 2010.

Douglas Equipment Ltd.

On April 6, 2011, the Corporation acquired the net assets of Douglas Equipment Ltd. (Douglas) for £12.3 million ($20.1 million) in cash. The Business Transfer Agreement contains customary representations and warranties, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation’s revolving credit facility.

Douglas designs and manufactures aircraft handling systems for the defense and commercial aerospace markets and operates within the Marine and Power Products division of the Flow Control segment. Douglas has approximately 135 employees and is headquartered in Cheltenham, U.K. Revenues of the acquired business were approximately $28 million for the year ended 2010.

The purchase price of the acquisitions has been allocated to the net tangible and intangible assets acquired with the remainder recorded as goodwill on the basis of estimated fair values, as follows:



(In thousands)	Anatec			Douglas			Total
Accounts receivable	$	4,685		$	945		$	5,630
Inventory	—			10,914			10,914
Property, plant, and equipment	1,581			619			2,200
Other current assets	185			309			494
Intangible assets	14,936			6,697			21,633
Current liabilities	(818		)	(5,038		)	(5,856		)
Net tangible and intangible assets	20,569			14,446			35,015
Purchase price	35,201			20,094			55,295
Goodwill	$	14,632		$	5,648		$	20,280

Tax deductible goodwill	$	14,632		$	5,648

CONTROLS

2013 Acquisitions

Arens Controls

On October 4, 2013, the Corporation acquired 100% of the membership interests of Arens Controls, LLC (Arens) for $95.6 million in cash, net of purchase price adjustments and cash acquired. The Purchase Agreement contains customary representations and warranties, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation’s revolving credit facility.

Arens is a designer and manufacturer of highly-engineered, precision operator interface controls and power management systems for commercial and off-road industrial vehicles. The acquired business operates within the Avionics & Industrial division of the Controls segment.

Arens has approximately 120 employees and is headquartered in Arlington Heights, Illinois. Revenues of the acquired business were approximately $57 million for the year ended 2012.

Parvus

On October 1, 2013, the Corporation acquired 100% of the share capital of Parvus Corporation (Parvus) for $37.1 million in cash, net of cash acquired. The Stock Purchase Agreement contains customary representations and warranties, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation’s revolving credit facility.

Parvus is a designer and manufacturer of rugged small form factor computers and communications subsystems for the aerospace, defense, homeland security, and industrial markets. The acquired business operates within the Defense Solutions division of the Controls segment.

Parvus has approximately 50 employees and is headquartered in Salt Lake City, Utah. Revenues of the acquired business were approximately $20 million for the year ended 2012.

The purchase price of the acquisitions has been allocated to the net tangible and intangible assets acquired with the remainder recorded as goodwill on the basis of estimated fair values, as follows:



(In thousands)	Parvus			Arens			Total
Accounts receivable	$	3,639		$	9,441		$	13,080
Inventory	5,122			5,349			10,471
Property, plant, and equipment	435			4,787			5,222
Other current assets	104			972			1,076
Intangible assets	15,000			43,100			58,100
Current and non-current liabilities	(3,854		)	(7,991		)	(11,845		)
Deferred income taxes	(5,518		)	—			(5,518		)
Due to seller	(484		)	—			(484		)
Net tangible and intangible assets	14,444			55,658			70,102
Purchase price	37,059			95,612			132,671
Goodwill	$	22,615		$	39,954		$	62,569

Tax deductible goodwill	$	—		$	39,954

2012 Acquisitions

Exlar Corporation

On December 28, 2012, the Corporation acquired all the outstanding shares of Exlar Corporation for $84.7 million, net of cash acquired. The Stock Purchase Agreement contains a purchase price adjustment mechanism and representations and warranties customary for a transaction of this type, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation’s revolving credit facility.

Exlar is a provider of motion control solutions, specifically electric actuators, to industry-leading customers in a variety of end markets including factory automation, food process/packaging and energy process, and military applications. Exlar employs 183 people and is headquartered in Chanhassen, Minnesota, with a sales and service office near Frankfurt, Germany. Revenues of the acquired business were approximately $40.0 million in 2011. The business will operate within the Integrated Sensing division of the Controls segment.

PG Drives Technology

On November 1, 2012, the Corporation acquired the net assets of PG Drives Technology, a business unit of Spirent plc, for $63.2 million in cash. The Asset Purchase Agreement contains customary representations and warranties. Management funded the purchase from the Corporation’s revolving credit facility and available cash on hand in foreign locations.

PG Drives Technology is a designer and manufacturer of highly engineered controllers and drives used in a wide variety of advanced electric-powered industrial and medical vehicles. PG Drives has 186 employees and operates principally from a design and manufacturing site in Christchurch, UK, with additional sales and technical support offices in the U.S., Taiwan, China, Hong Kong, South Korea, and Australia. Revenues of the acquired business were approximately $58.0 million in 2011. The business operates within the Avionics and Industrial division of the Controls segment.

Williams Controls

On October 31, 2012, the Corporation entered into a definitive merger agreement to acquire Williams Controls in a cash tender offer of $15.42 per share. Total cash consideration for the shares, including the value of restricted stock and stock options, was approximately $109.1 million, net of cash acquired of $10.2 million. The Corporation also assumed $13.8 million in bank debt. Management funded the purchase from the Corporation’s revolving credit facility.

Williams Controls is a designer and manufacturer of highly engineered electronic sensors and electronic throttle controls for off-road equipment, heavy trucks, and military vehicles. Williams employs 294 people and operates principally from their headquarters in Portland, Oregon, with additional production facilities in China and India. Revenues of the acquired business were approximately $64.4 million for their last fiscal year ending September 30, 2012. The business operates within the Avionics and Industrial division of the Controls segment.

The purchase price of the acquisitions has been allocated to the net tangible and intangible assets acquired with the remainder recorded as goodwill on the basis of estimated fair values, as follows:



(In thousands)	PG Drives			Williams Controls			Exlar			Total
Accounts receivable	$	7,596		$	10,383		$	5,852		$	23,831
Inventory	10,541			10,434			8,039			29,014
Property, plant, and equipment	1,589			16,137			4,902			22,628
Other current assets	220			4,518			1,684			6,422
Intangible assets	25,200			44,000			36,400			105,600
Current and non-current liabilities	(4,739		)	(11,131		)	(6,061		)	(21,931		)
Pension and postretirement benefits	—			(8,144		)	—			(8,144		)
Deferred income taxes	(244		)	(14,820		)	(14,849		)	(29,913		)
Debt assumed	—			(13,819		)	—			(13,819		)
Net tangible and intangible assets	40,163			37,558			35,967			113,688
Purchase price	63,219			109,077			84,708			257,963
Goodwill	$	23,056		$	71,519		$	48,741		$	144,275

Tax deductible goodwill	$	23,056		$	—		$	—

2011 Acquisitions

South Bend Controls

On October 11, 2011, the Corporation acquired the assets of South Bend Controls (SBC) for $11.2 million in cash, including a purchase price adjustment of $0.3 million. The Asset Purchase Agreement contains customary representations and warranties, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase primarily from the Corporation’s revolving credit facility and available cash on hand.

SBC is a designer and manufacturer of highly engineered, solenoid-based components used in critical applications serving the aerospace, defense, industrial, and medical markets. Based in South Bend, Indiana, SBC has 63 employees, with union representation for 36 members of the workforce. Revenues of the acquired business were approximately $8.0 million in 2010. The business operates within the Integrated Sensing division of the Controls segment.

ACRA Control Ltd.

On July 28, 2011, the Corporation acquired all of the issued and outstanding capital stock of ACRA Control Ltd. (ACRA) for €42.6 million (approximately $61.1 million) in cash, net of cash acquired. The Share Purchase Agreement contains customary representations and warranties, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase primarily from the Corporation’s revolving credit facility and cash generated from foreign operations.

ACRA is a supplier of data acquisition systems and networks, data recorders, and telemetry ground stations for both defense and commercial aerospace markets and operates within the Integrated Sensing division of the Controls segment. ACRA had 128 employees on the date of acquisition and operates from a leased facility in Dublin, Ireland. ACRA had revenues of approximately €20.5 million ($26.2 million) for its fiscal year ended March 31, 2011.

Predator Systems, Inc.

On January 7, 2011, the Corporation acquired all the issued and outstanding capital stock of Predator Systems, Inc. (PSI) for $13.5 million in cash. The Stock Purchase Agreement contains customary representations and warranties, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation’s revolving credit facility.

PSI designs and manufactures motion control components and subsystems for ground defense, ordnance guidance, and aerospace applications and operates within the Flight Systems division of the Controls segment. PSI had 45 employees as of the date of the acquisition and is headquartered in Boca Raton, FL. Revenues of the acquired business were approximately $8.0 million for the year ended December 31, 2010.

The purchase price of the acquisitions has been allocated to the net tangible and intangible assets acquired with the remainder recorded as goodwill on the basis of estimated fair values, as follows:



(In thousands)	South Bend			ACRA			PSI			Total
Accounts receivable	$	1,635		$	8,901		$	862		$	11,398
Inventory	2,990			6,539			1,856			11,385
Property, plant, and equipment	727			1,600			2,100			4,427
Other current assets	32			456			67			555
Intangible assets	3,500			17,054			4,700			25,254
Current and non-current liabilities	(648		)	(6,048		)	(190		)	(6,886		)
Deferred income taxes	—			(2,303		)	—			(2,303		)
Net tangible and intangible assets	8,236			26,199			9,395			43,830
Purchase price	11,175			61,053			13,503			85,731
Goodwill	$	2,939		$	34,854		$	4,108		$	41,901

Tax deductible goodwill	$	2,939		$	—		$	4,108

SURFACE TECHNOLOGIES

2012 Acquisitions

F.W. Gartner Thermal Spraying, Ltd.

On December 31, 2012, the Corporation acquired the assets of F.W. Gartner Thermal Spraying, Ltd. (Gartner), for approximately $35.5 million in cash. The Asset Purchase Agreement contains a purchase price adjustment mechanism and representations and warranties customary for a transaction of this type, including a portion of the purchase price deposited into escrow as security for potential indemnification claims against the seller. Management funded the purchase from the Corporation’s revolving credit facility.

Gartner is a provider of thermal spray coatings for the oil and gas, petrochemical, power generation, and other industrial markets in the U.S. Gartner operates out of two leased facilities in the Houston, TX area and employs 115 people. Revenues of the acquired business were approximately $19 million for the year ended December 31, 2011.

The purchase price of the acquisitions has been allocated to the net tangible and intangible assets acquired with the remainder recorded as goodwill on the basis of estimated fair values, as follows:



(In thousands)	Gartner
Accounts receivable	$	5,411
Inventory	1,599
Property, plant, and equipment	6,705
Intangible assets	9,400
Current and non-current liabilities	(56		)
Due to seller	—
Net tangible and intangible assets	23,059
Purchase price	35,497
Goodwill	$	12,438

Tax deductible goodwill	$	12,438

2011 Acquisitions

IMR Test Labs

On July 22, 2011, the Corporation acquired the assets of IMR Test Labs (IMR), for approximately $20.0 million in cash. The Corporation paid $18.0 million at closing, with a portion of the purchase price retained as security for potential indemnification claims. The purchase price retention of $2.0 million was paid to the sellers in 2013. Management funded the purchase primarily from the Corporation’s revolving credit facility and available cash on hand.

The agreement also provides for contingent consideration based on achievement of certain sales targets. Based on the estimated amount of sales over the two-year measurement period, the Corporation recorded a liability of the estimated fair value of the contingent consideration in the amount of $1.6 million. In 2012, $0.6 million was paid to the sellers related to 2011 performance. In 2013, a final payment of $1.0 million was paid related to 2012 performance. Additional purchase price of $0.2 million was also recorded related to the agreement’s purchase price adjustment mechanism, resulting in final cash consideration paid of $21.8 million.

IMR is a provider of mechanical and metallurgical testing services for the aerospace, power generation, and general industrial markets. Revenues of the acquired business were approximately $14.0 million for the year ended December 31, 2010.

Surface Technologies Division of BASF Corporation

On April 8, 2011, the Corporation acquired certain assets of BASF Corporation’s Surface Technologies (BASF) business for $20.5 million in cash. The Asset Purchase Agreement contains customary representations and warranties and provided for a purchase price adjustment based on the value of inventory at closing. The purchase price adjustment is reflected in the disclosed purchase price. Management funded the purchase from the Corporation’s revolving credit facility.

BASF’s Surface Technologies business is a supplier of metallic and ceramic thermal spray coatings primarily for the aerospace and power generation markets and expands the coatings capabilities within the Surface Technologies segment. The business has approximately 150 employees at three operating facilities located in East Windsor, CT, Wilmington, MA, and Duncan, SC. Revenues of the acquired business were approximately $29.0 million for the year ended December 31, 2010.

The purchase price of the acquisitions has been allocated to the net tangible and intangible assets acquired with the remainder recorded as goodwill on the basis of estimated fair values, as follows:



(In thousands)	BASF			IMR			Total
Accounts receivable	$	—		$	2,050		$	2,050
Inventory	1,514			—			1,514
Property, plant, and equipment	12,774			3,125			15,899
Other current assets	—			133			133
Intangible assets	3,000			3,830			6,830
Current liabilities	(263		)	(505		)	(768		)
Net tangible and intangible assets	17,025			8,633			25,658
Purchase price	20,501			21,801			42,302
Goodwill	$	3,476		$	13,168		$	16,644

Tax deductible goodwill	$	3,476		$	13,168