Acquisitions And Pending Acquisition

3 Months Ended

Mar. 30, 2012

Acquisitions And Pending Acquisition [Abstract]

Acquisitions And Pending Acquisition

NOTE 2. ACQUISITIONS AND PENDING ACQUISITION

The Company continually evaluates potential acquisitions that either strategically fit with the Company's existing portfolio or expand the Company's portfolio into a new and attractive business area. The Company has completed a number of acquisitions that have been accounted for as purchases and have resulted in the recognition of goodwill in the Company's financial statements. This goodwill arises because the purchase prices for these businesses reflect a number of factors including the future earnings and cash flow potential of these businesses; the multiple to earnings, cash flow and other factors at which similar businesses have been purchased by other acquirers; the competitive nature of the process by which the Company acquired the business; and the complementary strategic fit and resulting synergies these businesses bring to existing operations.

The Company makes an initial allocation of the purchase price at the date of acquisition based upon its understanding of the fair value of the acquired assets and assumed liabilities. The Company obtains this information during due diligence and through other sources. In the months after closing, as the Company obtains additional information about these assets and liabilities, including through tangible and intangible asset appraisals, and 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 Company is continuing to evaluate certain pre-acquisition contingencies associated with certain of its 2012 and 2011 acquisitions and is also in the process of obtaining valuations of acquired intangible assets and certain acquisition related liabilities in connection with these acquisitions. The Company will make appropriate adjustments to the purchase price allocation prior to completion of the measurement period, as required. The Company evaluated whether any adjustments to the prior year purchase price allocations were material and concluded no retrospective adjustment to prior financial statements was required.

The following briefly describes the Company's acquisition activity for the three months ended March 30, 2012. For a description of the Company's acquisition activity for the year ended December 31, 2011, reference is made to Note 2 of the financial statements as of and for the year ended December 31, 2011 and the notes thereto included in the Company's 2011 Annual Report on Form 10-K.

During the first three months of 2012, the Company acquired three businesses for total consideration of $56 million in cash, net of cash acquired. The businesses acquired manufacture and distribute products and/or provide services in the life science, water quality and test & measurement markets and were acquired to complement existing units of the Life Sciences & Diagnostics, Environmental and Test & Measurement segments. The aggregate annual sales of the three businesses acquired at the time of their respective acquisitions, in each case based on the acquired company's revenues for its last completed fiscal year prior to the acquisition, were approximately $25 million. The Company preliminarily recorded an aggregate of $17 million of goodwill related to these acquisitions.

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 the three months ended March 30, 2012 ($ in millions):

	Total
Accounts receivable	$	8.8
Inventories		8.6
Property, plant and equipment		1.1
Goodwill		17.3
Other intangible assets, primarily trade names, customer relationships and patents		10.9
In-process research and development		56.0
Accounts payable		(3.0	)
Other assets and liabilities, net		(44.0	)
Net cash consideration	$	55.7

Pro Forma Financial Information

The unaudited pro forma information for the periods set forth below gives effect to the 2012 and 2011 acquisitions as if they had occurred as of January 1, 2011. The pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the acquisitions been consummated as of that time ($ in millions, except per share amounts):

	Three Months Ended
	March 30, 2012		April 1, 2011
Sales	$	4,317.6	$	4,267.9
Net earnings from continuing operations		519.0		429.3
Diluted earnings per share from continuing operations	$	0.73	$	0.61

Pending Acquisition

On April 10, 2012, the Company and X-Rite, Incorporated ("X-Rite") entered into a definitive agreement pursuant to which an indirect, wholly-owned subsidiary of the Company is making a cash tender offer to acquire all of the outstanding shares of common stock of X-Rite for $5.55 per share, for an aggregate purchase price of approximately $625 million including debt assumed and net of cash acquired, to be followed by a second step cash-out merger at the offer price. The offer is subject to customary conditions, including tender of a majority of the outstanding shares into the offer (on a fully diluted basis), receipt of applicable regulatory approvals and the absence of a material adverse effect on X-Rite. The Company anticipates completing the acquisition in the second quarter of 2012. X-Rite, a global leader in color measurement technology, develops, manufactures, markets and supports innovative color solutions through measurement systems, software, color standards and services. X-Rite had revenues of approximately $238 million in 2011, and would become part of the Company's Industrial Technologies segment. The Company anticipates financing the acquisition of X-Rite with available cash.