Distribution Of Communications Business

3 Months Ended

Apr. 03, 2015

Discontinued Operations and Disposal Groups [Abstract]

Distribution Of Communications Business

DISTRIBUTION OF COMMUNICATIONS BUSINESS

In the fourth quarter of 2014, Danaher entered into a definitive agreement with NetScout Systems, Inc. ("NetScout") to combine the majority of the Company's Test & Measurement segment's communications business with NetScout (Danaher will retain the data communications cable installation business and the communication service provider (field and test tool systems) business of Fluke Networks and these will become part of the Test & Measurement segment’s instruments business following the closing of the transaction). The transaction will be structured as a distribution of the communications business to Danaher shareholders in either a spin-off transaction, a split-off transaction, or a combination split-off and spin-off, followed by a merger of the communications business with a subsidiary of NetScout for consideration of 62.5 million NetScout shares, subject to adjustment. Both the distribution and merger are expected to qualify as tax-free transactions to Danaher and its shareholders, except to the extent that cash is paid to Danaher stockholders in lieu of fractional shares. If Danaher elects a spin-off, all Danaher shareholders will participate pro-rata. If Danaher elects a split-off, Danaher will conduct an exchange offer pursuant to which its shareholders will elect whether to exchange Danaher shares for common units of the communications business. If the split-off exchange offer is not fully subscribed, the additional common units of the communications business held by Danaher will be distributed in a spin-off on a pro-rata basis to Danaher shareholders. Danaher will determine which approach it will take prior to closing the transaction and no decision has been made at this time. At closing, depending on the number of shares of NetScout common stock outstanding, Danaher shareholders will receive approximately 60% of the shares of NetScout common stock outstanding following the combination.

The transaction remains subject to approval by NetScout’s shareholders, other customary closing conditions, Danaher’s receipt of a ruling by the U.S. Internal Revenue Service and an opinion of counsel regarding certain tax matters, and the absence of a material adverse change with respect to either the communications business or NetScout.  On December 24, 2014, NetScout received a request for additional information (“second request”) from the U.S. Department of Justice.  On March 19, 2015, NetScout and Danaher certified substantial compliance with the second request, and on April 22, 2015, NetScout received notification from the U.S. Department of Justice that it has closed its investigation into the transaction. Upon the closing of the transaction, the Company will classify the communications business as a discontinued operation in its historical financial statements. For the year ended December 31, 2014, sales of the communications business to be combined with NetScout were $760 million. The transaction is expected to close in mid-2015.