Acquisitions

12 Months Ended

Dec. 31, 2019

Acquisition

On April 30, 2018 (the Closing Date), we completed the acquisition of substantially all of Avanos Medical, Inc.'s (Avanos, previously Halyard Health, Inc.) Surgical and Infection Prevention business, the name “Halyard Health” (and all variations of that name and related intellectual property rights) and its information technology (IT) systems in exchange for $758 million, net of cash acquired. The Halyard S&IP business is a leading global provider of medical supplies and solutions for the prevention of healthcare associated infections across acute care and non-acute care markets. This business is reported as part of the Global Products segment.

The following table presents the fair value of the assets acquired and liabilities assumed recognized as of the acquisition date. The fair value of intangibles from this acquisition was primarily determined by applying the income approach, using several significant unobservable inputs for projected cash flows and a discount rate. These inputs are considered Level 3 inputs.



	Preliminary Fair Value Originally Estimated as of Acquisition Date ⁽¹⁾		Differences Between Prior and Current Period Preliminary Fair Value Estimate			Fair Value as of Acquisition Date
Assets acquired:
Current assets	$	330,870	$	—		$	330,870
Goodwill	130,217		(23,877		)	106,340
Intangible assets	191,230		13,000			204,230
Other noncurrent assets	218,387		5,616			224,003
Total assets	870,704		(5,261		)	865,443
Liabilities assumed:
Current liabilities	92,438		(12,428		)	80,010
Noncurrent liabilities	20,217		7,167			27,384
Total liabilities	112,655		(5,261		)	107,394
Fair value of net assets acquired, net of cash	$	758,049	$	—		$	758,049

⁽¹⁾As previously reported in our 2018 Form 10-K.

We are amortizing the fair value of acquired intangible assets, primarily customer relationships, a trade name and other intellectual property, over their estimated weighted average useful lives of eight to 12 years.

Goodwill of $106 million, which we assigned to our Global Products segment, consists largely of expected opportunities to expand into new markets and further develop a presence in the medical products segment. None of the goodwill recognized is expected to be deductible for income tax purposes.

The unaudited pro forma results of net revenue for the year ended December 31, 2018 as if Halyard S&IP was acquired on January 1, 2018 was $9.7 billion. The pro forma results of net income (loss) and net income (loss) per common share are not presented because the effects were not material to our historic consolidated financial statements. Accordingly, the pro forma results are not necessarily indicative of the results that would have been if the acquisition had occurred on the dates indicated, nor are the pro forma results indicative of results which may occur in the future.

Acquisition-related expenses in 2019 and 2018 consisted primarily of transition and transaction costs for the Halyard transaction. We recognized pre-tax acquisition-related expenses of $15.7 million and $45.3 million for the years ended December 31, 2019 and 2018.