On January 2, 2024, the Company completed the acquisition of Motion Solutions Parent Corp. (“Motion Solutions”), an Irvine, California-based provider of highly engineered integrated solutions, specializing in proprietary precision motion and advanced motion control solutions, for a total purchase price of $192.0 million in cash, net of working capital adjustments. The acquisition was financed with borrowings under the Company’s revolving credit facility. The addition of Motion Solutions enhances the Company’s product portfolio and further expands its presence in attractive medical and precision medicine spaces. Motion Solutions is included in the Medical Solutions reportable segment.

The acquisition of Motion Solutions has been accounted for as a business combination. The purchase price is allocated based upon a valuation of the fair values of assets acquired and liabilities assumed. Assets acquired and liabilities assumed have been recorded at their estimated fair values as of the acquisition date. The excess of the purchase price over the fair values of the acquired tangible assets, identifiable intangible assets and assumed liabilities was recorded as goodwill. The fair values of identifiable intangible assets were based on valuations using an income approach, specifically the multi-period excess earnings method for customer relationships and the relief-from-royalty method for developed technologies. The process for estimating the fair values of identifiable intangible assets requires the use of significant estimates and assumptions, including revenue growth rates, customer attrition rates, royalty rates, discount rates, technology obsolescence curves, and EBITDA margins. The Company’s estimates and assumptions in determining the estimated fair value of certain assets and liabilities are subject to change within the measurement period (up to one year from the acquisition date) as a result of additional information to be obtained with regard to facts and circumstances that existed as of the acquisition date.

Based upon the Company’s preliminary valuation, the purchase price for Motion Solutions was allocated as follows (in thousands):


	Purchase Price
	Allocation
Cash	$	776
Accounts receivable		8,515
Inventory		14,032
Property, plant and equipment		3,126
Operating lease assets		8,076
Intangible assets		83,000
Goodwill		106,430
Other assets		561
Total assets acquired		224,516
Accounts payable		5,305
Operating lease liabilities		8,514
Deferred tax liabilities		18,257
Other liabilities		464
Total liabilities assumed		32,540
Total assets acquired, net of liabilities assumed		191,976
Less: cash acquired		776
Purchase price, net of cash acquired	$	191,200

The purchase price allocation is preliminary as the Company is in the process of collecting additional information. The estimated purchase price allocation previously disclosed in the Form 10-Q for the period ended March 29, 2024 was revised during the second quarter of 2024 as new information was received and analyzed resulting in an increase in Intangible assets of $2.6 million, an increase in Inventory of $0.5 million, an increase in Deferred tax liabilities of $0.7 million, and a decrease in Goodwill of $2.4 million.

The fair value of intangible assets for Motion Solutions is comprised of the following:



	Estimated Fair		Amortization
	Value (In thousands)		Period
Developed technologies	$	34,400	7 years
Customer relationships		43,100	13 years
Backlog		5,500	1 year
Total	$	83,000

The preliminary purchase price allocation resulted in $83.0 million of identifiable intangible assets and $106.4 million of goodwill. As the Motion Solutions acquisition was structured as a stock acquisition for income tax purposes, the goodwill is not

deductible. The goodwill recorded represents the anticipated incremental value of future cash flows potentially attributable to: (i) Motion Solution’s ability to grow the business with existing and new customers, including leveraging the Company’s customer base; (ii) Motion Solution’s ability to grow the business through new product introductions; and (iii) cost improvements due to the integration of Motion Solution’s operations into the Company’s existing infrastructure.

The operating results of Motion Solutions were included in the Company’s results of operations beginning January 2, 2024. Motion Solutions contributed revenues of $41.5 million and a loss before income taxes of $1.7 million to the Company’s operating results for the six months ended June 28, 2024. The loss before income taxes from Motion Solutions for the period from the acquisition date through June 28, 2024 included amortization of inventory fair value adjustments of $2.8 million and amortization of purchased intangible assets of $6.5 million.

The pro forma information for all periods presented below includes the effect of business combination accounting resulting from the acquisition of Motion Solutions, including amortization of inventory fair value adjustments, amortization of intangible assets, interest expense on borrowings in connection with the acquisition, and the related tax effects, assuming that the acquisition had been consummated as of January 1, 2023. The pro forma financial information is presented for comparative purposes only and is not necessarily indicative of the results of operations that actually would have been achieved if the acquisition had taken place on January 1, 2023.


	Three Months Ended				Six Months Ended
	June 28,		June 30,		June 28,		June 30,
	2024		2023		2024		2023
Revenue	$	235,864	$	251,838	$	466,780	$	489,692
Net income	$	14,061	$	16,281	$	31,181	$	28,396

Acquisition costs are included in restructuring and acquisition related costs in the consolidated statements of operations. Acquisition-related costs for Motion Solutions was $1.1 million for the six months ended June 28, 2024.