23.ACQUISITION

On August 1, 2017, the company completed the acquisition of 100% of Dynaloy, LLC (“Dynaloy”) from Eastman Chemical Co. Dynaloy is a supplier of formulated cleaning solutions for the semiconductor and specialty manufacturing industries. The purchase price of approximately $13 million was paid in cash from our available cash balance. The acquisition of Dynaloy does not constitute a material business combination.

The company has accounted for the acquisition as a business combination in accordance with ASC 805, Business Combinations ("ASC 805"), and has included Dynaloy within the Materials reportable segment. In applying the provisions of ASC 805 and determining that Dynaloy represents a business, the company elected to early adopt and apply ASU 2017-01 (refer to Note 1). Under ASU 2017-01, the company first assessed whether all of the fair value of the acquired Dynaloy gross assets is concentrated in a single identifiable asset or group of identifiable assets. If that concentration existed, Dynaloy would not be considered a business. The company concluded that there was not such a concentration, as the fair value of the acquired gross assets is distributed between various intangible and tangible assets.

The company has allocated the acquisition purchase price to the tangible net assets and identifiable intangible assets acquired based on their estimated fair values at the acquisition date and recorded the excess as goodwill. The valuation of the assets and liabilities acquired was based on the information that was available as of the acquisition date and the expectations and assumptions that have been deemed reasonable by the company’s management. In performing these valuations, the company used discounted cash flows and other factors as the best evidence of fair value. The key underlying assumptions of the discounted cash flows were projected revenues and royalty rates. The company has recognized $5.0 million of goodwill, which is attributable to the revenue growth and operating synergies that Versum expects to realize from this acquisition.

The company’s estimates and assumptions used in determining the estimated fair values of the net assets acquired are subject to change within the measurement period (up to one year from the acquisition date) as a result of additional information obtained with regards to facts and circumstances that existed as of the acquisition date.

The following table presents the final aggregate purchase price allocation:



	Net Assets Acquired
(In millions)
Accounts receivable	$	1.0
Other current assets	0.1
Inventories	1.4
Properties and Equipment, net	2.4
Goodwill	5.0
Intangible assets	3.7
Other current liabilities	(0.4		)
Net assets acquired	$	13.2

The table below presents the intangible assets acquired as part of the acquisition of Dynaloy and the periods over which they will be amortized on a straight line basis:



	Amount		Weighted Average Amortization Period
(In millions, except years)
Technology	$	2.8	7
Trademarks	0.9		5
Total	$	3.7