Business Combinations

3 Months Ended

Dec. 31, 2011

Business Combinations [Abstract]

Business Combinations

(2) Business Combinations

Acquisition of IZI Medical Products, LLC

On November 14, 2011, Landauer acquired all of the outstanding equity interests of IZI Medical Products, LLC ("IZI"), a leading provider of high quality medical consumable accessories used in radiology, radiation therapy, and image guided surgery procedures, for $93,000 plus working capital and the assumption of liabilities. The Company completed the acquisition of IZI as a platform to expand into the radiation oncology, radiology, and image guided surgery end markets. The operating results of IZI are reported in the Medical Products reporting segment.

A portion of the purchase price, in the amount of $26,941, was applied to repay the outstanding indebtedness of IZI and certain unpaid expenses incurred by IZI and other disclosed parties in connection with the transaction. Landauer also deposited $9,300 of the purchase price into an escrow account, which will be held until January 2013 and applied to the settlement of the IZI seller's indemnification obligations, if any, in connection with the transaction. The Company funded the acquisition through borrowings under the new credit agreement with a syndicate of lenders led by BMO Harris and PNC Bank.

The following table summarizes the $94,283 of consideration transferred to acquire IZI and the assets acquired and liabilities assumed based on their fair values as of the date of the acquisition.

Current assets	$	4,587
Property, plant and equipment		763
Intangible assets		27,000
Goodwill		64,069
Non-current deferred taxes, net		212
Other non-current assets		24
Current liabilities		(2,196)
Other long-term liabilities		(176)
Total assets acquired and liabilities assumed	$	94,283

The excess of the consideration transferred over the fair value of the net tangible and intangible assets acquired resulted in goodwill of $64,069, which is attributable primarily to the earnings power of the future products and services expected to be produced by IZI, new customer expansion opportunities in adjacent markets that are expected to result from the business combination with Landauer, and the potential to acquire or merge with other businesses. The goodwill has been assigned to the Medical Products reporting segment. The Company will deduct $64,641 for income tax purposes and will be amortized over 15 years. The Company acquired trademarks and tradenames in the amount of $2,000 which have indefinite lives, patents in the amount of $2,000 which are being amortized over 7 years, and $23,000 of customer relationships which are being amortized over 15 years. The trademarks and tradenames, patents and customer relationships have the same value for tax purposes and will all be amortized over 15 years.

IZI's revenues of $2,191 and net income of $233 were recognized in the Company's consolidated financial statements for the period from November 14, 2011 to December 31, 2011.

Unaudited Proforma Results

The following unaudited proforma summary presents Landauer's consolidated information as if IZI had been acquired on October 1, 2010.

	Three months ended December 31,
	2011		2010
Proforma revenues	$	38,927	$	33,162
Proforma net income attributed to Landauer, Inc.		5,059		5,293

The proforma results include adjustments to IZI's accounting policies to align with those of Landauer. Certain other adjustments to IZI's results, together with the consequential tax effects, include: customer freight expense netted against customer freight revenues; increased costs to reflect the impact of the increase, upon acquisition, in finished goods fair value; additional amortization for intangible assets; elimination of management fees charged by IZI's former majority shareholder; and elimination of IZI's interest expense related to its pre-existing debt agreements. The proforma adjustments also reflect: additional interest expense incurred in connection with debt financing of the acquisition compared to interest expense under its pre-existing debt agreements; amortization of debt issuance and administration costs; and the income tax impact of these adjustments. The unaudited proforma information is not necessarily indicative of the results of operations that would have been achieved if the acquisition had been effective as of the beginning of the period presented.

Other Acquisitions

During the first three months of fiscal 2012, the Company completed the acquisition of a therapy physics practice in North Carolina, which was not material to the Company's consolidated financial statements. During the first three months of fiscal 2011, the Company established an unconsolidated joint venture in Turkey, which was not material to the Company's consolidated financial statements.