XML 38 R28.htm IDEA: XBRL DOCUMENT v3.22.4
Coherent Acquisition (Tables)
 6 Months Ended
Dec. 31, 2022
Business Combination and Asset Acquisition [Abstract]  
Fair Value of Consideration The preliminary total fair value of consideration paid in connection with the acquisition of Coherent, Inc. consisted of the following (in $000):
SharesPer ShareTotal Consideration
Cash paid for merger consideration——$5,460,808 
Shares of COHR common stock issued to Legacy Coherent stockholders22,587,885$49.831,125,554 
Converted Legacy Coherent RSUs attributable to pre-combination service——82,037 
Payment of Legacy Coherent debt——364,544 
Payment of Legacy Coherent transaction expenses——62,840 
$7,095,783 
Schedule of Preliminary Purchase Price Allocation of Assets Acquired and Liabilities Assumed
Our preliminary allocation of the purchase price of Legacy Coherent, based on the estimated fair value of the assets acquired and liabilities assumed as of the Closing Date, is as follows (in $000):
Preliminary Allocation as of 7/1/2022
Previously Reported September 30, 2022Measurement Period Adjustments (i)As Adjusted (preliminary)
Assets
Current Assets
Cash, cash equivalents, and restricted cash$393,324 $— $393,324 
Accounts receivable270,928 — 270,928 
Inventories (ii)497,345 66,581 563,926 
Prepaid and refundable income taxes (iii)8,869 (1,592)7,277 
Prepaid and other current assets41,467 — 41,467 
Total Current Assets1,211,933 64,989 1,276,922 
Property, plant & equipment, net (iv)424,228 16,704 440,932 
Deferred income taxes (iii)1,115 (793)322 
Other assets102,726 — 102,726 
Other intangible assets, net (v)2,425,454 1,079,546 3,505,000 
Goodwill4,005,727 (910,633)3,095,094 
Total Assets$8,171,183 $249,813 $8,420,996 
Liabilities
Current Liabilities
Current portion of long-term debt$4,504 $— $4,504 
Accounts payable116,754 — 116,754 
Accrued compensation and benefits60,596 — 60,596 
Operating lease current liabilities13,002 — 13,002 
Accrued income taxes payable16,936 — 16,936 
Other accrued liabilities (vi)136,042 702 136,744 
Total Current Liabilities347,834 702 348,536 
Long-term debt22,991 — 22,991 
Deferred income taxes (iii)563,824 249,674 813,498 
Operating lease liabilities43,313 — 43,313 
Other liabilities (vi)97,438 (563)96,875 
Total Liabilities$1,075,400 $249,813 $1,325,213 
Preliminary aggregate acquisition consideration$7,095,783 $— $7,095,783 
(i) The Company recorded measurement period adjustments to its preliminary acquisition date fair values due to the refinement of its valuation models, assumptions and inputs. The following measurement period adjustments were based upon information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the measurement of the amounts recognized at that date.
(ii) The condensed combined balance sheet has been adjusted to record Legacy Coherent’s inventories at a preliminary fair value of approximately $564 million, an increase of $67 million from the preliminary fair value reported at September 30, 2022 with a corresponding decrease to goodwill. The Condensed Combined Statement of Earnings (Loss) for the three and six months ended December 31, 2022 includes cost of goods sold of approximately $112 million and $158 million, respectively, related to the increased basis in the preliminary fair value compared to the carrying value. The $112 million cost of goods sold recognized in the three months ended December 31, 2022 includes an increase of $33 million due to the measurement period adjustment which relates to a previous reporting period. The costs are being amortized over the expected period during which the acquired inventory is sold, the six months ended December 31, 2022, and thus are not anticipated to affect the Condensed Consolidated Statements of Earnings (Loss) beyond twelve months after the Closing Date.
(iii) The Company has adjusted its prepaid and refundable income taxes, deferred tax asset and deferred tax liability positions as of December 31, 2022, to $7 million, $0 million and $813 million, respectively, as a result of measurement period adjustments.
(iv) The Condensed Consolidated Balance Sheet has been adjusted to record Legacy Coherent’s property, plant and equipment (consisting of land, buildings and improvements, equipment, furniture and fixtures, and leasehold improvements) at a preliminary fair value of approximately $441 million, an increase of $17 million from the preliminary fair value reported at September 30, 2022 with a corresponding decrease to goodwill. The Condensed Consolidated Statements of Earnings (Loss) have been adjusted to recognize additional depreciation expense related to the increased basis. The additional depreciation expense is computed with the assumption that the various categories of assets will be depreciated over their remaining useful lives on a straight-line basis.
(v) Preliminary identifiable intangible assets in the condensed combined balance sheet increased $1.1 billion from the preliminary fair value reported at September 30, 2022 with a corresponding decrease to goodwill. Intangibles amortization recorded in cost of goods sold for the three and six months ended December 31, 2022 was $6 million and $43 million, respectively, and included a reduction in the current quarter of $16 million due to the measurement period adjustment which relates to a previous reporting period. Intangibles amortization recorded in selling, general and administrative expenses for the three and six months ended December 31, 2022 was $80 million and $105 million, respectively, and included an increase in the current quarter of $27 million due to the measurement period adjustment which relates to a previous reporting period.
Preliminary identifiable intangible assets consist of the following and are being amortized over their estimated useful lives in the Condensed Consolidated Statements of Earnings (Loss) (in $000):
Preliminary
Fair Value		Estimated Useful Life
Trade names and trademarks$430,000 N/A
Customer relationships1,830,000 15 years
Developed technology1,157,500 13.5 years
Backlog87,500 1.0 year
Intangible assets acquired$3,505,000 
(vi) The Company recorded approximately $1 million of increases in other current liabilities and $1 million of decreases in other liabilities as measurement period adjustments.
Unaudited Supplemental Pro Forma Financial Information
The unaudited supplemental pro forma financial information for the periods presented is as follows (in $000):
Three Months Ended December 31, 2022Three Months Ended December 31, 2021
Revenue$1,370,285 $1,191,326 
Net Earnings (Loss)101,349 (65,115)
Six Months Ended December 31, 2022Six Months Ended December 31, 2021
Revenue$2,714,855 $2,378,111 
Net Earnings (Loss)211,420 (241,375)