Discontinued Operations

12 Months Ended

Dec. 31, 2012

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

Discontinued Operations

On December 21, 2012, the company's board of directors approved of the company entering into an agreement to sell Invacare Supply Group (ISG) and accordingly the company determined on that date that the "held for sale" criteria of ASC 360-10-45-9 were met. Accordingly, the assets and liabilities of ISG (long-lived asset disposal group) is shown at its carrying amount which is lower than the fair value less cost to sale.

On January 18, 2013, as part of the company's globalization strategy, and to allow it to focus on its core equipment product lines, the company completed the sale of the ISG medical supplies business for a purchase price of approximately $150,800,000 in cash, which is subject to final post-closing adjustments. ISG had been operated on a standalone basis and reported as a reportable segment of the company. The company expects to record a gain of approximately $60,414,000 pre-tax in the first quarter of 2013 which represents the excess of the net sales price over the book value of the assets and liabilities of ISG as of the date of completion of the disposition. The sale of this business is expected to be dilutive to the Company's results. The Company utilized the proceeds from the sale to reduce debt outstanding under its revolving credit facility in the first quarter of 2013.

The assets and liabilities of ISG that were sold are shown as held for sale in the company's Consolidated Balance Sheets and are comprised of the following (in thousands):

	December 31, 2012		December 31, 2011
	(In thousands)
Trade receivables, net	$	44,196	$	37,583
Inventories, net	25,165		24,042
Other current assets	9,355		5,988
Property and Equipment, net	1,368		—
Goodwill	23,073		—
Assets held for sale - current	$	103,157	$	67,613
Assets held for sale - non current	$	—	$	24,445
Accounts payable	$	17,692	$	12,354
Accrued expenses	4,602		3,902
Accrued income taxes	1,064		680
Liabilities held for sale - current	$	23,358	$	16,936

The net sales of the discontinued operation were $341,606,000, $299,491,000 and $297,517,000 for 2012, 2011 and 2010, respectively. Earnings before income taxes for the discontinued operation were $16,238,000, $14,725,000 and $14,097,000 for 2012, 2011 and 2010, respectively.

The company will continue to sell product to the acquirer of ISG and expects to provide certain transitional services over a period of less than one year. The net cash flows expected to be paid and received related to ISG are not expected to be significant.

As a result of these considerations, the company has classified ISG as a discontinued operation for all periods presented.