Disposals

12 Months Ended

Dec. 31, 2023

Discontinued Operations and Disposal Groups [Abstract]

Tripwire

On February 22, 2022, we sold Tripwire for gross cash consideration of $350 million. The divestiture of Tripwire represented a strategic shift impacting our operations and financial results. As a result, the Tripwire disposal group, which was included in our Industrial Automation Solutions segment, is reported within discontinued operations. We recognized a loss on disposal of discontinued operations, net of tax of $9.2 million during 2022. The following table summarizes the operating results of the Tripwire disposal group up to the February 22, 2022 disposal date:


	January 1 - February 22, 2022		Year Ended December 31, 2021
	(In thousands)
Revenues	$	12,067	$	106,840
Cost of sales	(3,256)		(24,321)
Gross profit	8,811		82,519
Selling, general and administrative expenses	(8,185)		(48,308)
Research and development expenses	(5,528)		(34,433)
Amortization of intangible assets	(638)		(7,716)
Asset impairments	—		(131,178)
Loss before taxes	$	(5,540)	$	(139,116)

From January 1, 2022 to February 22, 2022, the Tripwire disposal group did not have any capital expenditures and recognized share-based compensation expense of $0.2 million. During the year ended December 31, 2021, the Tripwire disposal group had capital expenditures of $6.1 million and recognized share-based compensation expense of $2.2 million. The disposal group did not have any significant non-cash charges for investing activities during either time period.

Brazil Oil and Gas Cable Business

During 2021, we sold an oil and gas cable business in Brazil that met all of the criteria to classify the assets and liabilities of this business, formerly part of the Industrial Automation Solutions segment, as held for sale. At such time, the carrying value of the disposal group exceeded the fair value less costs to sell, which we determined based upon the expected sale price, by $3.4 million. Therefore, we recognized an impairment charge of $3.4 million (including a goodwill impairment of $1.7 million and intangible asset impairment of $1.0 million) in 2021. The impairment charge was excluded from Segment EBITDA of our Industrial Automation Solutions segment. We completed the sale of the oil and gas cable business in Brazil during 2021 for $10.9 million, net of cash delivered with the business.

Grass Valley

During 2020, we sold Grass Valley to Black Dragon Capital. The sale included deferred consideration consisting of a $175.0 million seller’s note, up to $88 million in PIK (payment-in-kind) interest on the seller’s note, and $178.0 million in potential earnout payments. Based upon a third party valuation specialist using certain assumptions in a Monte Carlo analysis, the estimated fair value of the seller’s note was $34.9 million. During 2021, we sold the seller's note to a third party for $62.0 million and recognized a gain on sale of $27.0 million. We accounted for the earnout under a loss recovery approach and did not record an asset as of the disposal date. Any subsequent recognition of an earnout will be based on the gain contingency guidance.