Business Combinations

9 Months Ended

Sep. 30, 2012

Business Combinations [Abstract]

Business Combinations

Business Combinations

On December 21, 2011, PolyOne, pursuant to the terms of an Agreement and Plan of Merger with ColorMatrix Group, Inc. (ColorMatrix) and Audax ColorMatrix Holdings, LLC, acquired all of the equity of ColorMatrix. The acquisition date fair value of the consideration transferred, which consisted solely of cash, was $486.1 million, net of cash acquired of $1.9 million. ColorMatrix is a developer and manufacturer of performance enhancing additives for plastic products, liquid colorants, and fluoropolymer and silicone colorants, and operates globally with research and development and production facilities in North America, South America, Europe and Asia. The ColorMatrix acquisition reflects our strategy to expand our specialty business and our international presence.

At December 31, 2011, the allocation of the purchase price to the assets acquired and liabilities assumed from the ColorMatrix acquisition was preliminary as we had not completed our assessment of deferred income taxes, acquired property, intangibles, obligations or finalized the working capital set forth in the purchase agreement. The following table summarizes the adjustments made to the purchase price allocation during the nine-month period ended September 30, 2012.

(In millions)	Initial Allocation		Adjustments to Fair Value			Recasted Allocation
Cash and cash equivalents	$	1.9	$	—		$	1.9
Accounts receivable, net	30.7		—			30.7
Inventories, net	32.8		(1.9		)	30.9
Other current assets	7.1		(0.9		)	6.2
Property, net	25.4		4.0			29.4
Other non-current assets	1.3		(1.0		)	0.3
Other intangible assets, net	276.0		(0.6		)	275.4
Goodwill	225.8		1.4			227.2
Total assets acquired	601.0		1.0			602.0
Accounts payable	16.2		—			16.2
Accrued expenses and other liabilities	3.5		—			3.5
Other non-current liabilities	93.3		1.0			94.3
Total liabilities assumed	113.0		1.0			114.0
Net assets acquired	$	488.0	$	—		$	488.0

As required by FASB Accounting Standards Codification (ASC) Topic 805, Business Combinations, our consolidated financial statements at December 31, 2011 were retrospectively adjusted to reflect the above adjustments. As of September 30, 2012, the purchase price allocation remains preliminary and will be finalized as we complete our assessment of deferred income taxes and other obligations. The purchase price allocation will be finalized during the fourth quarter.

During 2012, funding of our joint venture with E.A. Juffali & Brothers Company occurred and construction of the manufacturing facility began with operations expected to commence in 2013. The joint venture enables PolyOne to expand its Global Color and Additives business into the Middle East. The joint venture is 51% owned by PolyOne and is based in Jeddah, Saudi Arabia. The joint venture is reflected within our condensed consolidated financial statements, including the non-controlling interest.