Investment in Unconsolidated Affiliates

9 Months Ended

Oct. 01, 2016

Investment in Unconsolidated Affiliates [Abstract]

Investment in Unconsolidated Affiliates

Note 6 – Investment in Unconsolidated Affiliates

The Company owns a 50 percent interest in Tecumseh Products Holdings LLC (Joint Venture), an unconsolidated affiliate that acquired Tecumseh Products Company (Tecumseh) during the third quarter of 2015.  The Company also owns a 50 percent interest in a second unconsolidated affiliate that provided financing to Tecumseh in conjunction with the acquisition.  These investments are recorded using the equity method of accounting, as the Company can exercise significant influence but does not own a majority equity interest or otherwise control the respective entities.  Under the equity method of accounting, these investments are stated at initial cost and are adjusted for subsequent additional investments and the Company's proportionate share of earnings or losses and distributions.

The Company records its proportionate share of the investees' net income or loss one quarter in arrears as income (loss) from unconsolidated affiliates, net of tax, in the Condensed Consolidated Statements of Income.  

The following tables present summarized financial information derived from the Company's equity method investees'  combined consolidated financial statements, which are prepared in accordance with U.S. GAAP.

(In thousands)	June 30,  2016		September 30, 2015
Current assets	$	254,910	$	251,389
Noncurrent assets		133,200		112,156
Current liabilities		155,406		178,784
Noncurrent liabilities		74,291		63,643

	June 30, 2016
(In thousands)	For the Quarter Ended			For the Nine Months Ended
Net sales		$	146,700		$	437,200
Gross profit			22,200			59,700
Net income			2,244			6,097

Included in the equity method investees' net income for the nine months ended June 30, 2016 is a gain of $17.1 million that resulted from the allocation of the purchase price, which was finalized during the quarter ended December 31, 2015.  That gain was offset by restructuring and impairment charges of $5.3 million and net losses of $5.7 million.