Goodwill And Intangible Assets

12 Months Ended

Dec. 28, 2013

Goodwill and Intangible Assets Disclosure [Abstract]

(5) Goodwill and Intangible Assets

Goodwill

As described in Note 4 of Notes to the Consolidated Financial Statements, the Company acquired two businesses in 2013 and four businesses in 2012. The excess of purchase price over estimated fair value was assigned to goodwill.

As described in Note 3 of Notes to the Consolidated Financial Statements, the Company evaluates the carrying amount of goodwill annually or more frequently if events or circumstances indicate that an asset might be impaired. As a result of the annual review, there were certain reporting units where the carrying value, exceeded fair value.

The Electrical segment reporting units affected experienced declines in sales and profitability that were more pronounced in the latter part of fiscal 2013, combined with reduced future expected cash flows driven by weak sales and margins resulting from economic conditions in Australia, India and Europe. Another reporting unit had reduced future expected cash flows from a slower than expected adoption of switched reluctance motor technology.

In the Mechanical segment, one reporting unit had reduced expected cash flows resulting from weak sales in the hydraulic fracturing market within the oil and gas industry.

See Note 3 of Notes to the Consolidated Financial Statements, "Asset Impairments and Other, Net" for additional details of the impairment and related charges.

The following table presents changes to goodwill during the periods indicated (in millions):




	Total			Electrical Segment			Mechanical Segment
Balance as of December 31, 2011	$	1,117.6		$	1,105.0		$	12.6
Acquisitions and valuation adjustments	25.9			2.7			23.2
Translation adjustments	7.5			4.0			3.5
Balance as of December 29, 2012	$	1,151.0		$	1,111.7		$	39.3

Acquisitions and valuation adjustments	15.3			15.3			—
Less: Impairment charges	76.3			64.2			12.1
Translation adjustments	(8.1		)	(7.8		)	(0.3		)
Balance as of December 28, 2013	$	1,081.9		$	1,055.0		$	26.9

Cumulative goodwill impairment charges	$	76.3		$	64.2		$	12.1

Intangible Assets

As described in Note 3 of Notes to the Consolidated Financial Statements, the Company evaluates intangible assets in accordance with prescribed guidance. As a result of this review, a total of $17.0 million of intangible assets were deemed impaired. A switched reluctance technology reporting unit in the U.S. recognized a $16.2 million impairment in technology and a motor distribution reporting unit in Europe recognized a $0.8 million impairment in customer relationships.

Intangible Technology assets at December 29, 2012 included $17.2 million of In-Process Research and Development. (See also Note 3 of Notes to the Consolidated Financial Statements).

Gross intangible assets consist of the following (in millions):



	Useful Life (years)	December 29, 2012		Acquisitions		Impairment Charges		Translation Adjustments			December 28, 2013
Customer Relationships	3 - 14	$	244.9	$	10.3	$	0.8	$	(0.6	)	$	253.8
Technology/IPRD	3 - 9	147.5		1.8		16.2		(0.1		)	133.0
Trademarks	3 - 20	32.7		0.4		—		(0.5		)	32.6
Patent and Engineering Drawings	10	16.6		—		—		—			16.6
Non-compete Agreements	3 - 5	8.2		—		—		0.1			8.3
Total Gross Intangibles		$	449.9	$	12.5	$	17.0	$	(1.1	)	$	444.3

Accumulated amortization on intangible assets consist of the following:



	December 29, 2012		Amortization		Translation Adjustments			December 28, 2013
Customer Relationships	$	78.7	$	23.0	$	0.3		$	101.4
Technology	41.8		16.4		0.3			57.9
Trademarks	15.7		2.5		0.2			18.0
Patent and Engineering Drawings	13.3		1.7		—			15.0
Non-compete Agreements	7.2		0.5		(0.1		)	7.8
Total Accumulated Amortization	$	156.7	$	44.1	$	0.7		$	200.1
Intangible Assets, Net of Amortization	$	293.2						$	244.2

The Company's customer relationships are generally long-term in nature with useful lives established at acquisition based on historical attrition rates.

Amortization expense was $44.1 million in fiscal 2013, $44.0 million in fiscal 2012 and $33.2 million in fiscal 2011.



	Estimated Amortization
Year	Estimated Amortization
2014	$	42.9
2015	36.3
2016	31.2
2017	25.1
2018	23.8

- 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.

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