Fair Value Measurements

12 Months Ended

Oct. 26, 2012

Fair Value Measurements

17. Fair Value Measurements

GAAP establishes a three-level fair value hierarchy that prioritizes information used in developing assumptions when pricing an asset or liability as follows:

Level 1: Quoted prices in active markets for identical instruments

Level 2: Inputs, other than quoted prices in active markets, that are observable for the instrument either directly or indirectly or quoted prices for similar instruments in active markets

Level 3: Unobservable inputs for the instrument where there is little or no market data, which requires the reporting entity to develop its own assumptions

GAAP requires the use of observable market data, when available, in making fair value measurements. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

The following tables present the fair value hierarchy for those assets and liabilities measured at fair value and disclose the fair value of long-term obligations recorded at cost as of October 26, 2012 and October 28, 2011. As of October 26, 2012 and October 28, 2011 we did not have any level 3 assets or liabilities:

Fair Value Measurements at October 26, 2012
In thousands	Carrying Value		Total Fair Value		Level 1		Level 2
Current Assets
Cash equivalents	$	49,513	$	49,513	$	49,513	$	—
Other Current Assets
Derivatives	$	16,780	$	16,780	$	—	$	16,780
Other Accrued Liabilities
Derivatives	$	7,095	$	7,095	$	—	$	7,095
Long-term Obligations Including Amounts due within One Year
6.0 % Senior Notes	$	248,360	$	285,500	$	285,500	$	—
6.625% Senior Notes	$	148,466	$	175,605	$	175,605	$	—
5.125% Senior Notes	$	496,088	$	552,150	$	552,150	$	—
Term Loan	$	462,500	$	458,954	$	—	$	458,954

Fair Value Measurements at October 28, 2011
In thousands	Carrying Value		Total Fair Value		Level 1		Level 2
Current Assets
Cash equivalents	$	3,447	$	3,447	$	3,447	$	—
Cash held in escrow	$	866,000	$	866,000	$	866,000	$	—
Other Current Assets
Derivatives	$	8,904	$	8,904	$	—	$	8,904
Other Long-term Assets
Investment in unconsolidated affiliate	$	380,114	$	371,802	$	371,802	$	—
Other Accrued Liabilities
Derivatives	$	4,004	$	4,004	$	—	$	4,004
Long-term Obligations Including Amounts due within One Year
6.0 % Senior Notes	$	248,008	$	281,878	$	281,878	$	—
6.625% Senior Notes	$	148,441	$	164,504	$	164,504	$	—
Term Loan	$	493,750	$	486,949	$	—	$	486,949
5.125% Senior Notes	$	495,755	$	536,350	$	536,350	$	—

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value:

Cash equivalents: The carrying value approximates fair value based on the short-term nature of these instruments.

Cash held in escrow: The carrying value approximates fair value.

Derivatives: The fair value of forward foreign exchange contracts is based upon a valuation model that discounts cash flows resulting from the differential between the contract price and the market-based forward rate.

Senior Notes: The fair market value of the Senior Notes is estimated based on market quotations at the respective period end.

Term Loan: The fair value of our term loan is estimated using discounted cash flows and market conditions.

Investment in Unconsolidated Affiliate: The fair value of the investment in IMM at October 28, 2011 was estimated based on an active quoted market price. We obtained control of IMM on December 29, 2011, and the results of operations of IMM have been included with our Underground Mining Machinery segment from the acquisition date forward. See Note 3, “Acquisitons” for further information.