Acquisitions and Divestitures

6 Months Ended

Mar. 31, 2015

Acquisitions And Divestitures [Abstract]

Business Combinations Disclosure

In the first quarter of 2015, the Company completed three acquisitions with combined annualized sales of approximately $32 million in Process Management's measurement devices and systems and solutions businesses. Total cash paid for all businesses was $145 million, net of cash acquired. The Company recognized goodwill of $76 million ($43 million of which is expected to be tax deductible) and other intangible assets of $62 million, primarily customer relationships and intellectual property with a weighted-average life of approximately eleven years.

In connection with its longer-term strategy to divest selected slower-growth businesses, on January 30, 2015 the Company completed the previously announced sale of its mechanical power transmission solutions business to Regal Beloit Corporation for $1.4 billion. The Company recognized a pretax gain from the transaction of $932 million ($528 million after-tax, $0.77 per share). Assets and liabilities held-for-sale at the closing date were as follows: other current assets, $181 million (accounts receivable, inventories, other); other assets, $375 million (property, plant and equipment, goodwill, other noncurrent assets); accrued expenses, $51 million (accounts payables, other current liabilities); and other liabilities, $41 million. After-tax proceeds of approximately $1 billion will be used for share repurchase. This business was previously reported in the Industrial Automation segment and had fiscal 2014 sales of $605 million and earnings before income taxes of $87 million. Power transmission solutions designs and manufactures market-leading couplings, bearings, conveying components and gearing and drive components, and provides supporting services and solutions.

The Company has begun evaluating strategic alternatives, including a potential sale, for its InterMetro business. InterMetro is a leading manufacturer and supplier of storage and transport products in the food service, commercial products and healthcare industries. This business had annual sales of $284 million in 2014 and is reported in the Commercial & Residential Solutions segment.

In the first quarter of 2014, the Company completed the divestiture of a 51 percent controlling interest in Artesyn and in the fourth quarter of 2014, the Company sold its connectivity solutions business. Both of these businesses had been previously reported in the Network Power segment. Consolidated operating results for the six months ended March 31, 2014 included combined sales of $183 million and a pretax loss of $9 million (net loss, $7 million) for these businesses.