Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2016

Goodwill and Other Intangible Assets

Note 12—Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill by segment were as follows:


	Interconnect		Cable
	Products and		Products and
	Assemblies		Solutions		Total
Goodwill at December 31, 2015	$	2,569.2	$	123.7	$	2,692.9
Acquisition-related		971.5		17.9		989.4
Foreign currency translation		25.5		—		25.5
Goodwill at September 30, 2016	$	3,566.2	$	141.6	$	3,707.8

The increase in goodwill, net of foreign currency translation, during the first nine months of 2016 is primarily due to the acquisition of FCI on January 8, 2016, which is included in the Interconnect Products and Assemblies segment. The increase in goodwill in the Cable Products and Solutions segment resulted from one acquisition which closed during the third quarter of 2016.

The Company performs its annual evaluation for the impairment of goodwill for the Company’s reporting units as of each July 1. The Company has defined its reporting units as the two reportable business segments “Interconnect Products and Assemblies” and “Cable Products and Solutions”. In 2016, the Company utilized the option to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. In accordance with applicable guidance, an entity is not required to calculate the fair value of a reporting unit unless the Company determines, based on a qualitative assessment of events and circumstances, that it is more likely than not that its fair value is less than its carrying amount. As of July 1, 2016, the Company determined that it is more likely than not that the fair value of its reporting units is greater than their carrying amounts. The Company has not recognized any goodwill impairment in 2016, 2015 or 2014 in connection with its annual impairment test.

Other than goodwill noted above, as well as indefinite-lived trade name intangible assets of approximately $186.1 and $52.3 as of September 30, 2016 and December 31, 2015, respectively, the Company’s intangible assets are subject to amortization. A summary of the Company’s amortizable intangible assets as of September 30, 2016 and December 31, 2015 is as follows:


	September 30, 2016						December 31, 2015
	Gross				Net		Gross				Net
	Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
	Amount		Amortization		Amount		Amount		Amortization		Amount
Customer relationships	$	385.7	$	149.8	$	235.9	$	315.6	$	122.6	$	193.0
Proprietary technology		106.7		38.4		68.3		53.8		30.9		22.9
License agreements		6.0		6.0		—		6.0		6.0		—
Backlog and other		28.0		27.5		0.5		19.7		19.2		0.5
Total	$	526.4	$	221.7	$	304.7	$	395.1	$	178.7	$	216.4

Customer relationships, proprietary technology, license agreements, and backlog and other amortizable intangible assets have weighted average useful lives of approximately 10 years, 11 years, 8 years and 1 year, respectively, for an aggregate weighted average useful life of approximately 10 years at September 30, 2016.

Intangible assets are included in Intangibles and other long-term assets in the accompanying Condensed Consolidated Balance Sheets. The amortization expense for the three months ended September 30, 2016 and 2015 was approximately $11.6 and $8.9, respectively. The amortization expense for the nine months ended September 30, 2016 and 2015 was approximately $42.8 and $25.6, respectively. As of September 30, 2016, amortization expense estimated for the remainder of 2016 is approximately $11.9 and for each of the next five fiscal years is approximately $47.8 in 2017, $43.7 in 2018, $39.5 in 2019, $33.4 in 2020 and $28.8 in 2021.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details