Goodwill

The following table shows changes in the carrying amount of goodwill for the years ended December 31, 2018, and 2017.



	Mobile Solutions			Power Solutions			Life Sciences			Total
Balance as of December 31, 2016	$	73,263		$	201,934		$	168,332		$	443,529
Currency impact	884			747			—			1,631
Goodwill acquired in acquisitions	—			—			9,452			9,452
Balance as of December 31, 2017	74,147			202,681			177,784			454,612
Currency impact and other	(705		)	(1,882		)	(3,118		)	(5,705		)
Goodwill acquired in acquisitions	—			2,657			165,288			167,945
Impairments	(73,442		)	(109,100		)	—			(182,542		)
Measurement period adjustments	—			149			4,993			5,142
Balance as of December 31, 2018	$	—		$	94,505		$	344,947		$	439,452

The following table shows the gross carrying amount of goodwill and accumulated impairment charges as of December 31, 2018 and 2017.



	December 31, 2018							December 31, 2017
	Gross Carrying Amount		Accumulated Impairment Charges			Net Book Value		Gross Carrying Amount		Accumulated Impairment Charges			Net Book Value
Mobile Solutions	$	74,147	$	(74,147	)	$	—	$	74,147	$	—		$	74,147
Power Solutions	205,405		(110,900		)	94,505		204,481		(1,800		)	202,681
Life Sciences	344,947		—			344,947		177,784		—			177,784
Total goodwill	$	624,499	$	(185,047	)	$	439,452	$	456,412	$	(1,800	)	$	454,612

Goodwill acquired in 2018 is related to the acquisitions as described in Note 3 and is derived from the value of the businesses acquired. During 2018, we recorded $161.8 million of goodwill related to the Paragon Medical acquisition, $8.0 million related to the Bridgemedica acquisition, and $2.8 million related to the Technical Arts acquisition. We have performed an assessment of the Paragon Medical opening balance sheet which is subject to completion of our integration procedures for accounting policies. For the Bridgemedica acquisition, we have finalized our valuation related to the assets acquired and liabilities assumed. For the Technical Arts acquisition, we have completed a preliminary purchase price allocation and are in the process of finalizing the fair value of assets acquired and liabilities assumed. The preliminary fair value of the businesses acquired was based on management business plans and future performance estimates which are subject to a high degree of management judgment and complexity. Actual results may differ from these projections and the differences may be material.

During 2018, as a result of the changes in our organizational and management structure, goodwill was reassigned to operating segments with goodwill assigned to Power Solutions and Life Sciences using a relative fair value allocation. For the purpose of goodwill impairment testing, the operating segments (Mobile Solutions, Power Solutions, and Life Sciences) are considered reporting units and tested on a stand-alone basis. For further information on the organizational changes, see Note 1.

During the fourth quarter 2018, our market capitalization declined to a level that was less than the net book value of our stockholders’ equity. We performed our annual goodwill impairment analysis as of October 1, 2018, and elected to early adopt ASU 2017-4. The goodwill impairment analysis required significant judgments to calculate the fair value for each of Mobile Solutions, Power Solutions, and Life Sciences, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term growth rate for each operating segment, and determination of weighted average cost of capital. A number of significant assumptions and estimates are involved in the application of the discounted cash flow model to forecast operating cash flows, including market growth and market share, sales volumes and prices, costs to produce, discount rate, and estimated capital needs. Management considers historical experience and all available information at the time the fair values of its reporting units are estimated. Assumptions in estimating future cash flows are subject to a high degree of judgment and complexity. Changes in assumptions and estimates may affect the fair value of goodwill and could result in impairment charges in future periods. As a result of our analysis, the Company recorded an impairment loss on goodwill of $73.4 million and $109.1 million for Mobile Solutions and Power Solutions, respectively, to the “Goodwill impairment” line on the Consolidated Statements of Operations and Comprehensive Income (Loss). In addition, goodwill in Power Solutions was reduced by $1.6 million related to adjusting deferred tax liabilities for tax deductible goodwill, which is reflected in “Currency impact and other” in the above table. No goodwill impairment loss was recorded at Life Sciences.

Power Solutions goodwill as of December 31, 2018 was $94.5 million. In conjunction with the annual goodwill impairment test during the fourth quarter of 2018, Power Solutions goodwill was impaired by $109.1 million, resulting in the carrying value of the reporting unit being equal to its fair value. If our assessment of the relevant facts and circumstances change, or if the actual performance falls short of expected results, an additional impairment charge will be required. An impairment of goodwill may also lead us to record an impairment of other intangible assets. The carrying value of finite-lived intangible assets for the Power Solutions group as of December 31, 2018, was $96.0 million.

Life Sciences has largely grown through acquisitions, with two acquisitions in 2018 plus another acquisition in late-2017. The Company is forecasting continued growth for the Life Sciences group; however, the fair value of the reporting unit exceeds the carrying value by approximately 3.7% in the most recent valuation. If our assessment of the relevant facts and circumstances change, or the actual performance falls short of expected results, impairment charges may be required. Total goodwill for the Life Sciences group as of December 31, 2018 was $344.9 million. An impairment of goodwill may also lead us to record an impairment of other intangible assets. The carrying amount of finite-lived intangible assets for the Life Sciences group as of December 31, 2018 was $244.4 million.

We completed our annual goodwill impairment review during the fourth quarters of 2017 and 2016 and concluded that there were no indicators of impairment at the reporting units with goodwill during those periods.