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Materials Technologies Separation
12 Months Ended
Sep. 30, 2017
Restructuring and Related Activities [Abstract]  
Materials Technologies Separation
4.  MATERIALS TECHNOLOGIES SEPARATION
Business Separation Costs
In connection with the disposition of the divisions comprising the former Materials Technologies segment, we incurred separation costs of $30.2, $50.6, and $7.5 in 2017, 2016, and 2015, respectively. These costs are reflected on the consolidated income statements as “Business separation costs” and include legal, advisory, and pension related costs.
Our fiscal year 2017 income tax provision includes net tax benefits of $5.5 primarily related to changes in tax positions on business separation activities. Our fiscal year 2016 income tax provision includes additional tax expense related to the separation of $51.8, of which $45.7 resulted from a dividend that was declared in June 2016 to repatriate $443.8 from a subsidiary in South Korea to the U.S. in anticipation of the separation of EMD from the industrial gases business in South Korea.
Transition Services Agreements
In connection with the spin-off of Versum, we entered into various agreements necessary to effect the spin-off and to govern the ongoing relationships between Air Products and Versum after the separation, including a transition services agreement by which we provide certain transition services to Versum. We expect all transition services to end in 2018. Seifi Ghasemi, chairman, president and chief executive officer of Air Products, is serving as non‑executive chairman of the Versum Board of Directors.
In connection with the sale of PMD, we entered into a transition services agreement by which we provide certain transition services to Evonik for no longer than 12 months from the date of sale of 3 January 2017.
The reimbursement for costs in support of the transition services agreements with Versum and Evonik has been reflected on the consolidated income statements within “Other income (expense), net.”
Loss on Extinguishment of Debt
On 30 September 2016, in anticipation of the spin-off, Versum entered into certain financing transactions to allow for a cash distribution of $550.0 and a distribution in-kind of senior unsecured notes (the "Notes") issued by Versum with an aggregate principal amount of $425.0 to Air Products. Air Products then exchanged these Notes with certain financial institutions for $418.3 of Air Products’ outstanding commercial paper. This noncash exchange, which was excluded from the consolidated statements of cash flows, resulted in a loss of $6.9 that has been reflected on the consolidated income statements as “Loss on extinguishment of debt.” This loss was deductible for tax purposes.