Goodwill And Other Intangible Assets

6 Months Ended

Jul. 01, 2012

Note 7—Goodwill and other intangible assets

In the first quarter of 2012, the Company changed its reporting structure to four reportable segments, three of which are geographically-based and one of which is comprised of the Company’s OEM business. See Note 14, “Business segment information” for additional information on the Company’s new reporting structure.

The following table provides information relating to changes in the carrying amount of goodwill, by reportable segment, for the six months ended July 1, 2012:


	North America Segment			EMEA Segment			AJLA Segment		OEM Segment			Total
	(Dollars in thousands)
Balance as of December 31, 2011
Goodwill	$	973,517		$	283,362		$	153,487	$	28,176		$	1,438,542
Accumulated impairment losses		—			—			—		—			—

		973,517			283,362			153,487		28,176			1,438,542
Goodwill impairment charges		(332,128	)		—			—		—			(332,128	)
Goodwill related to acquisitions		26,733			687			—		—			27,420
Goodwill transferred to assets held for sale		—			—			—		(28,176	)		(28,176	)
Translation adjustment		17			(10,868	)		784		—			(10,067	)
Transfer of goodwill		679			(679	)		—		—			—
Balance as of July 1, 2012
Goodwill		1,000,946			272,502			154,271		—			1,427,719
Accumulated impairment losses		(332,128	)		—			—		—			(332,128	)

	$	668,818		$	272,502		$	154,271	$	—		$	1,095,591

See Note 5 for discussion on the goodwill impairment charges.

The following table provides information, as of July 1, 2012 and December 31, 2011, regarding the gross carrying amount of, and accumulated amortization relating to, intangible assets:


	Gross Carrying Amount				Accumulated Amortization
	July 1, 2012		December 31, 2011		July 1, 2012			December 31, 2011
	(Dollars in thousands)
Customer lists	$	532,780	$	537,094	$	(128,335	)	$	(117,505	)
In-process research and development		45,480		—		—			—
Intellectual property		253,221		221,171		(85,322	)		(85,402	)
Distribution rights		16,245		16,669		(13,332	)		(13,484	)
Trade names		317,519		322,404		(127	)		(1,160	)

	$	1,165,245	$	1,097,338	$	(227,116	)	$	(217,551	)

The increase in intangible assets during the six months ended July 1, 2012 primarily reflects the effect of the Company’s acquisitions. See Note 3 for discussion of Company’s acquisitions.

Amortization expense related to intangible assets was approximately $10.7 million for both the three months ended July 1, 2012 and June 26, 2011 and $21.2 million and $21.4 million for the six months ended July 1, 2012 and June 26, 2011, respectively. Estimated annual amortization expense for the remainder of 2012 and the next four succeeding years is as follows (dollars in thousands):


2012	$	21,900
2013		44,700
2014		42,100
2015		37,600
2016		37,500

- 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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