EQUITY

The Company may use either authorized and unissued shares or treasury shares to meet share requirements resulting from the exercise of stock options and vesting of performance share awards and restricted stock units. Treasury stock is recognized at the cost to reacquire the shares. Shares issued from treasury are recognized using the first-in first-out method.

For the year ended December 31, 2014, the change in the carrying amount of treasury stock and treasury stock - at cost was driven by repurchases of the Company’s common stock, offset by the impact of a constructive retirement of treasury stock related to stock-based compensation. The constructive share retirement had the impact of decreasing the Company’s total value of treasury stock - at cost and decreasing retained earnings.

On September 10, 2013, MJN’s board of directors approved a share repurchase authorization of up to $500.0 million of the Company’s common stock (the “2013 Authorization”). During the year ended December 31, 2015, the Company repurchased $437.0 million of treasury shares under the 2013 Authorization. The purchase of these shares and the subsequent retirement of those shares impacted equity for the year ended December 31, 2015.

On October 20, 2015, MJN’s board of directors approved a new share repurchase authorization of an additional $1,500.0 million of the Company’s common stock (the “2015 Authorization”). On October 22, 2015, the Company entered into an accelerated share repurchase agreement (the “ASR Agreement”) with Goldman, Sachs & Co. (“Goldman”) to repurchase $1,000.0 million (the “Repurchase Price”) of the Company’s common stock. Under the terms of the ASR Agreement, 10,725,552 shares of common stock were received and retired by the Company on October 27, 2015 (which shares are equivalent to 85% of the number of shares of Company common stock that could be purchased with an amount of cash equal to the Repurchase Price based on the closing price of the Company’s common stock on October 22, 2015). The payments to Goldman were recorded as a reduction to shareholders’ equity consisting of a $1,000.0 million reduction to retained earnings, reflecting the value of the 10,725,552 shares received upon initial settlement and a $150.0 million decrease reflecting the value of the stock held back by Goldman pending final settlement of the ASR Agreement. At final settlement, which is expected to occur between March and June 2016, Goldman may be required to deliver additional shares of common stock to the Company, or, under certain circumstances, the Company may be required to deliver shares of its common stock or may elect to make a cash payment to Goldman, based generally on the average of the daily volume-weighted average prices of the Company’s common stock during the term of the ASR Agreement, subject, in part, to certain maximum and minimum prices. The ASR Agreement was primarily funded by the 2020 Notes and 2025 Notes issuance. See Note 16 for discussion on the Company’s debt.

Changes in common shares and treasury stock, including the impact of the retirement described above, were as follows:



(In millions)	Common Shares Issued		Treasury Stock		Treasury Stock - at Cost
Balance as of January 1, 2013	206.0		3.5		$	244.6
Stock-based compensation	0.8		0.2		18.9
Treasury stock purchases	—		1.1		88.4
Balance as of December 31, 2013	206.8		4.8		$	351.9

Stock-based compensation	1.0		0.1		7.9
Treasury stock purchases	—		0.6		52.9
Retirement of Treasury stock	(0.6	)	(0.6	)	(50.1		)
Balance as of December 31, 2014	207.2		4.9		$	362.6

Stock-based compensation	0.5		—		—
Treasury stock purchases	—		5.6		437.0
Retirement of Treasury stock	(5.6	)	(5.6	)	(437.0		)
Accelerated Share Repurchase	(10.7	)	—		$	—
Balance as of December 31, 2015	191.4		4.9		$	362.6

Changes in accumulated other comprehensive loss by component were as follows:



(Dollars in millions)	Foreign Currency Translation Adjustments			Deferred Gains/(Losses) on Derivatives Qualifying as Hedges			Pension and Other Post-employment Benefits			Total			Noncontrolling Interest					Redeemable Noncontrolling Interest
Balance as of January 1, 2015	$	(180.4	)	$	(17.8	)	$	(0.7	)	$	(198.9	)	$	1.9				$	(21.6	)

Deferred Gains/(Losses)	(138.9		)	19.7			(0.2		)	(119.4		)	(3.2		)	(1	)	(1.3		)	(1	)
Reclassification Adjustment for (Gains)/ Losses Included in Net Earnings	—			(20.6		)	0.1			(20.5		)	—					—
Tax Benefit/(Expense)	1.0			1.5			—			2.5			—					—
Acquisition of Noncontrolling Interest	(11.5		)	—			—			(11.5		)	(11.4		)			22.9

Balance as of December 31, 2015	$	(329.8	)	$	(17.2	)	$	(0.8	)	$	(347.8	)	$	(12.7	)			$	—

Balance as of January 1, 2014	$	(83.6	)	$	15.4		$	(1.0	)	$	(69.2	)	$	1.9				$	(14.4	)

Deferred Gains/(Losses)	(97.6		)	(52.9		)	—			(150.5		)	—					(7.2		)	(1	)
Reclassification Adjustment for (Gains)/ Losses Included in Net Earnings	—			(1.2		)	0.3			(0.9		)	—					—
Tax Benefit/(Expense)	0.8			20.9			—			21.7			—					—
Acquisition of Noncontrolling Interest	—			—			—			—			—					—

Balance as of December 31, 2014	$	(180.4	)	$	(17.8	)	$	(0.7	)	$	(198.9	)	$	1.9				$	(21.6	)

(1) Represents foreign currency translation adjustments.

Deferred losses on derivatives qualifying as hedges for the year ended December 31, 2014 included $64.4 million related to the change in the underlying position of the Company’s interest rate forward swaps intended to mitigate interest rate exposure associated with the 2044 Notes. These interest rate forward swaps were in a gain position with a fair value of $19.4 million at December 31, 2013. From December 31, 2013 through the Company’s settlement in May 2014, the fair value of these interest rate forward swaps declined $64.4 million, resulting in a loss position with a fair value of $45.0 million upon settlement.

Reclassification adjustments out of accumulated other comprehensive loss were as follows:



	Years Ended December 31,
	Affected Statement of Earnings Lines
(Dollars in millions)	Cost of Products Sold						Selling, General and Administrative					Tax Benefit/(Expense)						Net
	2015			2014			2015		2014			2015			2014			2015			2014
Deferred Gains/(Losses) on Derivatives Qualifying as Hedges:
Forward Exchange Contracts	$	23.8		$	2.0		$	—	$	—		$	(5.4	)	$	(0.6	)	$	18.4		$	1.4
Commodity Contracts	(1.8		)	0.1			—		—			0.7			—			(1.1		)	0.1
Interest Rate Forward Swap	(1.4		)	(0.9		)	—		—			0.5			—			(0.9		)	(0.9		)

Pension and Other Post-employment Benefit Plans:
Prior Service Benefits	—			(0.1		)	0.1		(0.2		)	—			—			0.1			(0.3		)
Total Reclassifications	$	20.6		$	1.1		$	0.1	$	(0.2	)	$	(4.2	)	$	(0.6	)	$	16.5		$	0.3