Discontinued Operations

9 Months Ended

Sep. 30, 2013

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations

Barnes Distribution Europe

On December 30, 2011, the Company sold substantially all of the assets of its Barnes Distribution Europe ("BDE") business to Berner SE (the "Purchaser") in a cash transaction pursuant to the terms of a Share and Asset Purchase Agreement ("SPA") among the Company, the Purchaser, and their respective relevant subsidiaries. The Company received gross proceeds of $33,358, which represented the initial stated purchase price, and yielded net cash proceeds of $22,492 after consideration of cash sold, transaction costs paid and closing adjustments. The final amount of proceeds from the sale of the BDE business was subject to post closing adjustments that were reflected in discontinued operations in periods subsequent to the disposition. The income from operations of discontinued businesses for the nine-month period ended September 30, 2013 includes a final settlement of a retained liability related to BDE.

As required by the terms of the SPA, the Company was required to place €9,000 of the proceeds in escrow to be used for any settlement of general representation and warranty claims. Absent a breach of warranty claim, the funds would be released from escrow on August 31, 2012 unless there were any then pending claims. Cash related to a pending claim would remain in escrow until a final determination of the claim had been made. On August 17, 2012, the Purchaser provided a notice of breach of various warranties to the Company.  The Company rejected the Purchaser's notice and demanded release of the full escrow effective August 31, 2012.  The Purchaser refused to release the full escrow, and only €3,900 plus interest was released whereas €5,100 ($6,895 at September 30, 2013) plus interest remains in escrow. The Company objected to the retention of the escrow and expects to prevail in this matter. The Company has recorded the restricted cash in other assets at September 30, 2013 and December 31, 2012.

Barnes Distribution North America

On April 22, 2013, the Company completed the sale of BDNA to MSC pursuant to the terms of the APA between the Company and MSC. The total cash consideration received for BDNA through September 30, 2013 was $539,116, net of transaction costs and closing adjustments paid. The net after-tax proceeds are expected to be $406,267 after consideration of certain post closing adjustments, transaction costs and income taxes. The Company has made income tax payments of $95,714 related to the gain on sale during the nine-month period ended September 30, 2013. The remaining income taxes payable have been recorded in accrued liabilities in the consolidated balance sheets. The Company recorded a net after-tax gain of $194,417 on the transaction in the nine-month period ended September 30, 2013, net of transaction-related costs of $9,986.

The following amounts related to BDE and BDNA were derived from historical financial information. The amounts have been segregated from continuing operations and reported as discontinued operations within the consolidated financial statements:

	Three months ended September 30,						Nine months ended September 30,
	2013			2012			2013			2012
Net sales	$	—		$	73,583		$	93,173		$	231,996
Income before income taxes	10			4,973			4,967			21,700
Income tax expense	463			2,505			1,688			8,537
(Loss) income from operations of discontinued businesses, net of income taxes	(453		)	2,468			3,279			13,163
(Loss) gain on transaction	(7		)	(21		)	313,471			(788		)
Income tax (expense) benefit on sale	(16		)	6			(119,054		)	39
(Loss) gain on the sale of businesses, net of income taxes	(23		)	(15		)	194,417			(749		)
(Loss) income from discontinued operations, net of income taxes	$	(476	)	$	2,453		$	197,696		$	12,414