2012 Separation Transaction

3 Months Ended

Dec. 30, 2011

2012 Separation Transaction.

2012 Separation Transaction

2.    2012 Separation Transaction

        On September 19, 2011, the Company announced that its Board of Directors ("the Board") approved a plan to separate the Company into three separate, publicly traded companies consisting of the Company's North American residential security business, its flow control business, and its commercial fire and security business ("the 2012 Separation"). The 2012 Separation is expected to be completed by the end of the third calendar quarter of 2012 through a tax-free pro rata distribution of all of the equity interest in the flow control and North American residential security businesses.

        Completion of the proposed separation is subject to certain conditions, including final approval by the Board and shareholders, receipt of tax opinions and rulings and the filing and effectiveness of registration statements with the U.S. Securities and Exchange Commission ("SEC"). The 2012 Separation will also be subject to the completion of any necessary financing.

        During the quarter ended December 30, 2011, the Company incurred $32 million of charges within separation costs in the Company's Consolidated Statement of Operations, primarily related to professional fees. The Company also incurred $23 million and $2 million of asset impairment charges and restructuring charges, respectively, related to the 2012 Separation which are recorded within restructuring, asset impairments and divestiture charges (gains), net in the Company's Consolidated Statement of Operations. See Note 4.