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Merger And Integration Activities
6 Months Ended
Jun. 30, 2012
Business Combination, Description [Abstract]  
Merger And Integration Activities
MERGER AND INTEGRATION ACTIVITIES
On December 6, 2010, Lance, Inc. and Snyder’s of Hanover, Inc. completed a merger (“Merger”) to create Snyder’s-Lance, Inc. The primary focus of our integration activities has been on the continued execution of our plan to convert the vast majority of company-owned routes to an independent business owner (“IBO”) distribution structure. This conversion was complete by the end of the second quarter of 2012. However, the sale and associated financing of certain route businesses are still in process and are expected to close in the second half of the year.
During the quarters ended June 30, 2012, and July 2, 2011, we incurred $0.2 million and $13.2 million, respectively, in severance costs and professional fees related to Merger and integration activities, which are included in selling, general and administrative expenses on the Condensed Consolidated Statements of Income. In addition, for the quarter ended June 30, 2012, we recorded a net gain of $10.9 million from the sale of route businesses associated with the conversion to an IBO distribution structure. This compared to only $0.2 million in net gains on the sale of routes businesses in the second quarter of 2011 as the conversion to an IBO distribution structure had just begun at that time.
During the six months ended June 30, 2012, and July 2, 2011, costs incurred associated with the Merger and integration activities included severance and professional fees of $1.7 million and $14.8 million, respectively. These costs are included in selling, general and administrative expenses on the Condensed Consolidated Statements of Income. In addition, we recorded a net gain of $20.2 million from the sale of route businesses associated with the conversion to an IBO distribution structure for the six months ended June 30, 2012 compared with a gain of only $0.3 million in the first six months of 2011.
The closure of the Corsicana, Texas manufacturing facility was completed during the quarter ended March 31, 2012. Upon closure of the facility, many assets were relocated to other manufacturing locations. Expenses incurred as part of the relocation process were $0.6 million in the second quarter of 2012 and $2.0 million for the six months ended June 30, 2012, and were included in cost of sales in the Condensed Consolidated Statements of Income. This asset relocation project was completed in the second quarter of 2012. The land and building in Corsicana, Texas of $1.9 million remains in assets held for sale in the Condensed Consolidated Balance Sheets.
During the quarter ended July 2, 2011, we recorded $10.1 million in asset impairment charges in the other income/expense, net line in the Condensed Consolidated Statements of Income. This non-cash impairment was recorded in connection with the IBO conversion due to the decision to sell the route trucks prior to the end of their useful lives. In order to determine an appropriate fair value for the route trucks, we reviewed market pricing for similar assets from multiple sources, including trucks sold at auction.