ACQUISITION

12 Months Ended

Jan. 03, 2014

Notes to Financial Statements [Abstract]

ACQUISITION

NOTE 8.ACQUISITIONS

Flint Acquisition

On May 14, 2012, we acquired the outstanding common shares of Flint for C$25.00 per share in cash, or C$1.24 billion (US$1.24 billion based on the exchange rate on the date of acquisition) and paid $110.3 million of Flint's debt prior to the closing of the transaction in exchange for a promissory note from Flint. On the date of acquisition, Flint had outstanding Canadian Notes with a face value of C$175.0 million (US$175.0 million), in addition to $31.6 million of other indebtedness. Our consolidated financial statements include the operating results of Flint after the date of acquisition, which are included as the results of our Oil & Gas Division.

The following table presents the allocation of Flint's identifiable assets acquired and liabilities assumed based on the estimates of their fair values as of the acquisition date.

Final allocation of purchase price:
(In millions)
Identifiable assets acquired and liabilities assumed:
	Cash and cash equivalents			$	4
	Trade and other receivables				544
	Inventory				61
	Other current assets				32
	Investments in and advances to unconsolidated joint ventures				147
	Property and equipment				420
	Other long-term assets				10
	Identifiable intangible assets:
		Customer relationships, contracts and backlog			163
		Trade names			93
		Other			10
			Total amount allocated to identifiable intangible assets		266
	Current liabilities				(244)
	Net deferred tax liabilities				(77)
	Long-term debt				(236)
	Other long-term liabilities				(31)
			Total identifiable net assets acquired		896
Goodwill					456
			Total purchase price	$	1,352

Intangible assets.  Intangible assets include customer relationships, contracts and backlog, trade name and other intangible assets associated with the Flint acquisition.

Customer relationships represent existing contracts and the underlying customer relationships and backlog. Customer relationships have estimated useful lives ranging from one to 13 years and are amortized based on the period over which the economic benefits of the intangible assets are expected to be realized.

Trade names represent the fair values of the acquired trade names and trademarks. The estimated useful lives of the trade names are 20 years. Other intangible assets represent the fair values of the existing non-compete agreements, supply contract agreement, and patents, which have estimated useful lives ranging from one to 13 years. We amortize the fair values of these intangible assets based on the period over which the economic benefits of the intangible assets are expected to be realized.

Goodwill.  Goodwill represents the excess of the purchase price over the fair value of the underlying net tangible and intangible assets. The factors that contributed to the recognition of goodwill from the acquisition of Flint include acquiring a workforce with capabilities in the oil andgas market and cost savings opportunities. This acquisition generated $456 million of goodwill, which isincluded in our Oil & Gas Division. None of the total acquired goodwill is expected to be tax deductible.

Investments in and advances to unconsolidated joint ventures.  As a result of the Flint acquisition, we hold a 50% voting and economic interest in a joint venture which provides operations, maintenance, asset management and project management services to the Canadian energy sector. The fair value of our investment in this joint venture at the acquisition date was higher than the underlying equity interest. This difference of $128.5million includes $38.0 million representing intangible assets, and the remaining amount representing goodwill. The intangible assets are being amortized, as a reduction to earnings against the equity in income of this unconsolidated joint venture, over a period ranging from three to 40 years. For the years ended January 3, 2014 and December 28, 2012, amortization of these intangible assets was $10.3 million and $5.9 million, respectively.

Acquisition-related expenses. In connection with the acquisitionof Flint, we recognized $16.1 million for the yearended December 28, 2012 in “Acquisition-related expenses” on our Consolidated Statements of Operations.

The acquisition related expenses consisted of investment banking, legal, tax and accounting fees, and other external costs directly related to the acquisition.

Flint's revenues and operating income included in the Consolidated Statement of Operations for the year ended December 28, 2012 from the May 14, 2012 acquisition to the end of the year amounted to $1.5 billion and $61.2 million, respectively.

Proforma results. The unaudited financial information in the table below summarizes the combined results of the operations of URS Corporation and Flint for the years ended December 28, 2012 and December 30, 2011, on a pro forma basis, as though the companies had been combined as of January 1, 2011, the beginning of the first period presented. The pro forma financial information includes the accounting effects of the business combination, including adjustments to the amortization of intangible assets, depreciation of property, plant and equipment, interest expense, adjustments to conform to U.S. GAAP, new compensation agreements, and foreign currency gains or losses arising from internal financing arrangements. The pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at January 1, 2011 nor should it be taken as indicative of our future consolidated results of operations.

		Year Ended		Year Ended
(In millions, except per share data)		December 28, 2012		December 30, 2011
Revenues		$	11,785.8	$	11,128.7
Net income (loss) including noncontrolling interests		$	409.1	$	(6.9)
Net income (loss) attributable to URS		$	292.9	$	(135.4)
Earnings (loss) per share:
	Basic EPS	$	3.94	$	(1.75)
	Diluted EPS	$	3.93	$	(1.75)

The table below shows the material pre-tax, nonrecurring adjustment in the pro forma financial informationfor theyears ended December 28, 2012 and December 30, 2011:

Pre-tax, nonrecurring adjustment (In millions)	Year Ended		Year Ended
		December 28, 2012		December 30, 2011 (1)
Acquisition-related expenses	$	27.7	$	(27.5)

• Included in the pro forma results for theyearended December 30, 2011 is a nonrecurring adjustment related to URS and Flintacquisition-related expenses. These expenses were included in the fiscal year 2011 pro forma results as if the acquisition occurred at the beginning of that fiscal year.