Business Acquisitions (Tables)

12 Months Ended

Dec. 31, 2018

Summary of the Preliminary Fair Values of the Assets Acquired and Liabilities Assumed

The following are the assets acquired and the liabilities assumed by the Company in the Aclara acquisition, reconciled to the acquisition consideration (in millions):



Accounts receivable	$	118.1
Inventories	73.5
Other current assets	8.5
Property, plant and equipment	30.9
Intangible assets	434.0
Accounts payable	(51.8		)
Other accrued liabilities	(93.3		)
Deferred tax liabilities, net	(42.1		)
Other non-current liabilities	(67.7		)
Noncontrolling interest	(2.5		)
Goodwill	708.7
Total Estimate of Consideration Transferred, Net of Cash Acquired	$	1,116.3

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination

The purchase price allocation to identifiable intangible assets acquired is as follows (in millions, except useful life amounts):



	Estimated Fair Value		Weighted Average Estimated Useful Life
Patents, tradenames and trademarks	$	55.0	20.0
Customer relationships	194.0		18.0
Developed technology	185.0		13.0
Total	$	434.0

Transaction costs

These costs were recorded in the respective financial statement line items as follows (in millions):



	Twelve Months Ended December 31,
	2018		2017
Selling & administrative expense	$	9.5	$	6.7
Interest expense	3.3		0.4
Total Aclara Transaction Costs	$	12.8	$	7.1

Business Acquisition, Pro Forma Information, Nonrecurring Adjustments

The following unaudited supplemental pro-forma information presents consolidated results as if the acquisition had been completed on January 1, 2017. Following that approach, for the purpose of the pro-forma results presented in the tables below, certain costs incurred by the Company during 2018 have been reclassified into the pro-forma 2017 period. Those reclassifications primarily include the following, which represent the amount of increase or (decrease) to reported results to arrive at the pro forma results. Per share amounts in 2018 reflect the reduction in the U.S. federal corporate income tax rate from 35% to 21%:



(pre-tax in millions, except per share amounts)	Twelve Months Ended December 31,					Per Diluted Share
	2018		2017			2018		2017
Aclara transaction costs incurred in 2018⁽¹⁾	$	12.8	$	(12.8	)	$	0.19	$	(0.16	)
Intangible amortization and inventory step up⁽²⁾	1.3		(44.3		)	0.02		(0.50		)
Interest expense⁽³⁾	3.8		(27.6		)	0.05		(0.31		)

⁽¹⁾ Aclara transaction costs incurred in 2018 have been reclassified into the comparable pro-forma 2017 period.

⁽²⁾ Aclara intangible amortization and inventory step up amortization incurred in 2018 has been reclassified into the comparable pro-forma 2017 period and increased to reflect the assumption the transaction was completed on January 1, 2017. The pro-forma 2018 period include the intangible amortization that would be incurred assuming the transaction had been completed on January 1, 2017.

⁽³⁾ Interest expense incurred in 2018, reflecting amounts incurred from the date of the acquisition, has been reclassified into the pro-forma 2017 period and increased to reflect the assumption the transaction was completed on January 1, 2017. The pro-forma 2018 period includes the interest expense that would have been incurred assuming the transaction had been completed on January 1, 2017.

Business Acquisition, Pro Forma Information

The pro-forma results were calculated by combining the results of the Company with the stand-alone results of Aclara for the pre-acquisition periods, as described above:



(in millions, except per share amounts)	Twelve Months Ended December 31,
	2018		2017
Net sales	$	4,531.2	$	4,180.9
Net income attributable to Hubbell	$	376.4	$	209.8
Earnings Per Share:
Basic	$	6.86	$	3.82
Diluted	$	6.83	$	3.81