6. Acquisitions and Divestitures

2011 Transaction

On June 29, 2011, the Company sold its Affinity business for $ 15.2 million in cash. Affinity designed and manufactured high precision, specialty engineered temperature-control equipment for semiconductor, pharmaceutical, life sciences and industrial applications. The Company recorded a gain on sale, net of transaction costs and income taxes, of $ 3.9 million. The Consolidated Financial Statements reflect Affinity as a discontinued operation for all periods presented.

The following table is a summary of the results of discontinued operations:

	December 31,
In thousands	2013		2012		2011
Net sales	$	—	$	—	$	13,255
Income before income taxes		—		—		1,374
Income tax expense		—		—		499
Income from discontinued operations		—		—		875
Gain on sale of discontinued operations, net of tax of $2,229		—		—		3,857
Income from discontinued operations, net of tax	$	—	$	—	$	4,732

2010 Transaction

On June 30, 2010, the Company divested its electrical papers product line business, included in the Performance Materials segment, for total consideration of $ 5.8 million, of which $ 4.8 million was paid on June 30, 2010, and the remaining $ 1.0 million paid on July 2, 2012. This transaction contained multiple deliverables, some of which were delivered on June 30, 2010, while others were delivered in subsequent periods. As part of the sale transaction, the Company transferred its electrical paper products customer list to the buyer, agreed not to compete (the “Non-Compete Agreement”) with the buyer with respect to the manufacture and sale of electrical insulating products for use in the transformer industry for a period of ten years, entered into a contract manufacturing agreement (the “Manufacturing Agreement”) with the buyer pursuant to which the Company was obligated to manufacture and sell electrical paper products to the buyer for a two-year period, and entered into a process technology license agreement (“License Agreement”). Pursuant to the License Agreement, the Company granted the buyer the right to use certain process technology and agreed to provide certain services to the buyer to facilitate the transfer of know-how for the manufacture of electrical paper products.

Gain Recognition

The Company recorded a gross gain on sale of $ 2.5 million, or a net gain on sale of $ 1.7 million, after a write-off of $ 0.8 million of goodwill that was allocated to the electrical papers product line, related to the delivered elements during the quarter ended June 30, 2010, and deferred a gain of $ 3.2 million as of June 30, 2010. The deferred amount was recognized as income as services under the License Agreement were delivered in periods subsequent to the sale, including the recognition of the remainder of the gain of $ 0.8 million during 2012, as the Company satisfied its obligations. The Company recognized $ 1.6 million and $ 0.8 million of gain during 2011 and 2010, respectively.