Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

The changes in the carrying amount of goodwill for 2015 and 2014, by business segment, were as follows:



	Fluid & Metering Technologies			Health & Science Technologies			Fire & Safety/ Diversified Products			Total
	(In thousands)
Goodwill	$	548,765		$	721,495		$	279,827		$	1,550,087
Accumulated goodwill impairment losses	(20,721		)	(149,820		)	(30,090		)	(200,631		)
Balance at January 1, 2014	528,044			571,675			249,737			1,349,456
Acquisitions (Note 2)	7,711			—			—			7,711
Foreign currency translation	(11,606		)	(8,210		)	(16,074		)	(35,890		)
Balance at December 31, 2014	524,149			563,465			233,663			1,321,277
Acquisitions (Note 2)	71,939			43,508			—			115,447
Foreign currency translation	(11,318		)	(6,155		)	(12,509		)	(29,982		)
Divestiture (Note 2)	—			(10,213		)	—			(10,213		)
Balance at December 31, 2015	$	584,770		$	590,605		$	221,154		$	1,396,529

ASC 350 requires that goodwill be tested for impairment at the reporting unit level on an annual basis and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying value. Goodwill represents the purchase price in excess of the net amount assigned to assets acquired and liabilities assumed.

Goodwill and other acquired intangible assets with indefinite lives were tested for impairment as of October 31, 2015, the Company’s annual impairment date. In assessing the fair value of the reporting units, the Company considers both the market approach and income approach. Under the market approach, the fair value of the reporting unit is determined by the respective trailing twelve month EBITDA and forward looking 2016 EBITDA (50% each), based on multiples of comparable public companies. The market approach is dependent on a number of significant management assumptions including forecasted EBITDA and selected market multiples. Under the income approach, the fair value of the reporting unit is determined based on the present value of estimated future cash flows. The income approach is dependent on a number of significant management assumptions including estimates of operating results, capital expenditures, net working capital requirements, long-term growth rate and discount rates. Weighting was equally attributed to both the market and income approaches (50% each) in arriving at the fair value of the reporting units.

There were no triggering events or changes in circumstances that would have required a review other than as of our annual test date, in 2015 or 2014. Based on the results of our measurement at October 31, 2015, all reporting units had a fair value that was greater than 70% in excess of carrying value, except for our IOP and Valves reporting unit. Our IOP reporting unit had a fair value that was approximately 20% in excess of carrying value and our Valves reporting unit had a fair value near its carrying value as a result of the formation of this reporting unit in conjunction with our Alfa acquisition in June 2015.

The gross carrying value and accumulated amortization for each major class of intangible asset at December 31, 2015 and 2014 is as follows:



	At December 31, 2015								At December 31, 2014
	Gross Carrying Amount		Accumulated Amortization			Net		Weighted Average Life	Gross Carrying Amount		Accumulated Amortization			Net
			(In thousands)								(In thousands)
Amortizable intangible assets
Patents	$	10,202	$	(6,175	)	$	4,027	11	$	10,016	$	(5,313	)	$	4,703
Trade names	110,658		(38,696		)	71,962		16	104,118		(32,881		)	71,237
Customer relationships	257,071		(144,134		)	112,937		11	222,486		(126,193		)	96,293
Non-compete agreements	794		(775		)	19		3	840		(636		)	204
Unpatented technology	78,562		(42,745		)	35,817		10	69,760		(35,165		)	34,595
Other	6,554		(5,579		)	975		10	7,034		(5,002		)	2,032
Total amortizable intangible assets	463,841		(238,104		)	225,737			414,254		(205,190		)	209,064
Unamortized intangible assets
Banjo trade name	62,100		—			62,100			62,100		—			62,100
Total intangible assets	$	525,941	$	(238,104	)	$	287,837		$	476,354	$	(205,190	)	$	271,164

The unamortized Banjo trade name was determined to be an indefinite lived intangible asset which is tested for impairment on an annual basis in accordance with ASC 350 or more frequently if events or changes in circumstances indicate that the asset might be impaired. The Company uses the relief-from-royalty method, a form of the income approach. The relief-from-royalty method is dependent of a number of significant management assumptions, including estimates of revenues, royalty rates and discount rates.

In 2015 and 2014, there were no triggering events or changes in circumstances that would have required a review other than as of our annual test date. Based on the results of our measurement as of October 31, 2015, the fair value of the Banjo trade name was greater than 20% in excess of carrying value.

Amortization of intangible assets was $42.4 million, $43.2 million and $44.3 million in 2015, 2014 and 2013, respectively. Based on intangible asset balances as of December 31, 2015, amortization expense is expected to approximate $42.9 million in 2016, $34.4 million in 2017, $24.3 million in 2018, $19.8 million in 2019 and $18.6 million in 2020.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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