Discontinued Operations

Electrical separation

On April 30, 2018, the Company completed the previously announced separation of the Electrical business from the rest of Pentair by means of a dividend in specie of the Electrical business, which was effected by the transfer of the Electrical business from Pentair to nVent and the issuance by nVent of nVent ordinary shares directly to Pentair shareholders. We did not retain an equity interest in nVent.

The results of the Electrical business have been presented as discontinued operations and the related assets and liabilities were reclassified as held for sale for all periods presented. The Electrical business had been previously disclosed as a stand-alone reporting segment. Separation costs related to the Separation and Distribution were $2.5 million and $11.7 million for the three months ended September 30, 2018 and 2017, respectively, and $82.4 million and $19.3 million for the nine months ended September 30, 2018 and 2017, respectively. These costs are reported in discontinued operations as they represent a cost directly related to the Separation and Distribution and were included within Income from discontinued operations, net of tax presented below.

Sale of Valves & Controls

On April 28, 2017, we completed the sale of the Valves & Controls business to Emerson Electric Co. for $3.15 billion in cash. The sale resulted in a gain of $181.1 million, net of tax. The results of the Valves & Controls business have been presented as discontinued operations. The Valves & Controls business was previously disclosed as a stand-alone reporting segment. Transaction costs of $1.7 million and $55.4 million related to the sale of Valves & Controls were incurred during the three and nine months ended September 30, 2017, respectively, and were recorded within (Loss) gain from sale of discontinued operations before income taxes presented below.

Operating results of discontinued operations are summarized below:



	Three months ended						Nine months ended
In millions	September 30, 2018			September 30, 2017			September 30, 2018		September 30, 2017
Net sales	$	—		$	540.7		$	693.9	$	2,006.3
Cost of goods sold	—			321.9			424.0		1,268.9
Gross profit	—			218.8			269.9		737.4
Selling, general and administrative	2.5			115.7			233.5		440.6
Research and development	—			10.5			14.6		38.1
Operating (loss) income	$	(2.5	)	$	92.6		$	21.8	$	258.7

Income from discontinued operations before income taxes	$	14.8		$	91.8		$	34.6	$	257.1
Income tax (benefit) provision	(4.1		)	13.6			7.6		37.3
Income from discontinued operations, net of tax	$	18.9		$	78.2		$	27.0	$	219.8

(Loss) gain from sale of discontinued operations before income taxes	$	—		$	(1.7	)	$	—	$	201.3
Provision for income taxes	—			—			—		2.4
(Loss) gain from sale of discontinued operations before income taxes	$	—		$	(1.7	)	$	—	$	198.9

The carrying amounts of major classes of assets and liabilities that were classified as held for sale on the Condensed Consolidated Balance Sheets were as follows:



In millions	December 31, 2017
Cash and cash equivalents	$	27.0
Accounts and notes receivable, net	348.5
Inventories	224.1
Other current assets	108.4
Current assets held for sale	$	708.0
Property, plant and equipment, net	$	265.8
Goodwill	2,238.2
Intangibles, net	1,236.6
Other non-current assets	249.0
Non-current assets held for sale	$	3,989.6
Accounts payable	$	174.1
Employee compensation and benefits	70.8
Other current liabilities	115.9
Current liabilities held for sale	$	360.8
Pension and other post-retirement compensation and benefits	$	189.2
Deferred tax liabilities	286.2
Other non-current liabilities	61.6
Non-current liabilities held for sale	$	537.0