Acquisitions and Dispositions

9 Months Ended

Sep. 26, 2015

Acquisitions and Dispositions Disclosure

Acquisitions and Dispositions [Text Block]

Note 2. Acquisitions

The company’s acquisitions have historically been made at prices above the determined fair value of the acquired identifiable assets, resulting in goodwill, due to expectations of the synergies that will be realized by combining the businesses. These synergies include the elimination of redundant facilities, functions and staffing; use of the company’s existing commercial infrastructure to expand sales of the acquired businesses’ products; and use of the commercial infrastructure of the acquired businesses to cost-effectively expand sales of company products.

Acquisitions have been accounted for using the purchase method of accounting, and the acquired companies’ results have been included in the accompanying financial statements from their respective dates of acquisition. Acquisition transaction costs are recorded in selling, general and administrative expenses as incurred.

2015

On September 30, 2015, the company acquired, within the Laboratory Products and Services segment, Alfa Aesar, a U.K.-based global manufacturer of research chemicals from Johnson Matthey Plc, for £257million ($389million) in cash. The acquisition expanded the company’s existing portfolio of chemicals, solvents and reagents. Revenues of Alfa Aesar were approximately £78 million in 2014. The purchase price allocation for the acquisition is not yet available.

In February 2015, the company acquired, within the Life Sciences Solutions segment, Advanced Scientifics, Inc., a North America-based global provider of single-use systems and process equipment for bioprocess production, for approximately $289 million. The acquisition expanded the company’s bioprocessing offerings. Revenues of Advanced Scientifics were approximately $80 million in 2014. The purchase price exceeded the fair value of the identifiable net assets and, accordingly, $125 million was allocated to goodwill, all of which is tax deductible.

In addition, in 2015, the company acquired, within the Analytical Instruments segment, selected assets of certain existing channel partnersfor its chromatography and mass spectrometry products and, within the Specialty Diagnostics segment, an existing channel partner for its transplant diagnostics products, for an aggregate purchase price of $19 million.

During the first nine months of 2015, the company made contingent purchase price payments totaling $11 million for acquisitions completed prior to 2015. The contingent purchase price payments were contractually due to the sellers upon achievement of certain performance criteria at the acquired businesses.

		The components of the purchase price and net assets acquired for 2015 acquisitions completed prior to
September 26, 2015 are as follows:
(In millions)			Advanced Scientifics		Other		Total
Purchase Price
	Cash paid		$	289.1	$	18.5	$	307.6
	Purchase price payable			—		1.3		1.3
	Cash acquired			(0.3)		(1.3)		(1.6)
			$	288.8	$	18.5	$	307.3
Net Assets Acquired
	Current assets		$	27.8	$	4.6	$	32.4
	Property, plant and equipment			10.6		0.1		10.7
	Definite-lived intangible assets:
		Customer relationships		90.0		7.9		97.9
		Product technology		36.5		—		36.5
		Tradenames and other		2.3		—		2.3
	Goodwill			125.1		8.9		134.0
	Other assets			0.2		—		0.2
	Liabilities assumed			(3.7)		(3.0)		(6.7)
			$	288.8	$	18.5	$	307.3

The weighted-average amortization periods for definite-lived intangible assets acquired in 2015 are 16 years for customer relationships, 10 years for product technology and 10 years for tradenames and other. The weighted average amortization period for all definite-lived intangible assets acquired in 2015 is 14 years.

Unaudited Pro Forma Information

The company acquired Life Technologies in February 2014. Had the acquisition of Life Technologiesbeen completed as of the beginning of 2013, the company’s pro forma results for the first nine months of 2014 would have been as follows:

				Nine Months Ended
		September 27,
(In millions except per share amounts)			2014
Revenues			$	12,675.0
Net Income			$	1,592.6
Earnings per Share:
	Basic		$	3.99
	Diluted		$	3.95

These pro forma results of operations have been prepared for comparative purposes only, and they do not purport to be indicative of the results of operations that actually would have resulted had the acquisition occurred on the date indicated or that may result in the future.

The company’s results would not have been materially different from its pro forma results had the company’s other 2014 or 2015 acquisitions occurred at the beginning of 2013 or 2014, respectively.