Acquisitions

3 Months Ended

Mar. 29, 2025

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

The Company accounts for acquisitions using the acquisition method in accordance with ASC 805, “Business Combinations,” in which assets acquired and liabilities assumed are recorded at fair value as of the date of acquisition. The operating results of the acquired business are included in the Company’s Condensed Consolidated Financial Statements from the date of the acquisition.

Dortmund Fab

On December 31, 2024, the Company completed the acquisition of a 200mm wafer fab located in Dortmund, Germany (“Dortmund Fab”) from Elmos Semiconductor SE. The total purchase price for the Dortmund Fab is approximately €94 million, of which a €37.2 million down payment (approximately $40.5 million) was paid in the third quarter of 2023 after regulatory approvals, and €56.7 million (approximately $58.8 million) was paid at closing. The business is reported in the Electronics-Semiconductor business within the Company’s Electronics segment.

The acquisition was funded with cash on hand. The total purchase consideration of $95.9 million, net of cash acquired, has been allocated, on a preliminary basis, to assets acquired and liabilities assumed, as of the completion of the acquisition, based on estimated fair values. The purchase consideration is subject to change for the final working capital adjustments. The purchase price allocation is preliminary because the evaluations necessary to assess the fair values of the net assets acquired are still in process. The primary areas not yet finalized relate to the completion of the valuation of certain acquired income tax assets and liabilities and personal property. As a result, these allocations are subject to change during the purchase price allocation period as the valuations are finalized.

The following table summarizes the preliminary purchase price allocation of the fair value of assets acquired and liabilities assumed in the Dortmund Fab acquisition:


(in thousands)	Purchase Price Allocation
Total purchase consideration:
Cash, net of cash acquired	$	95,942
Allocation of consideration to assets acquired and liabilities assumed:
Trade receivables	5,985
Inventories	6,600
Other current assets	8,479
Property, plant, and equipment	30,132
Intangible assets	1,800
Goodwill	57,439
Other long-term assets	8,579
Current liabilities	(8,248)

Other long-term liabilities	(14,824)
	$	95,942

All Dortmund assets and liabilities were recorded in the Electronics segment and are primarily reflected in the Europe geographic area. The goodwill resulting from this acquisition consists largely of the Company’s expected future product sales and synergies from combining Dortmund Fab’s products and technology with the Company’s existing semiconductor products portfolio. Goodwill resulting from the Dortmund acquisition is expected to be deductible for tax purposes.

Included in the Company’s Condensed Consolidated Statements of Net Income for the three months ended March 29, 2025 were net sales of $10.2 million and income before income taxes was nil since the December 31, 2024 acquisition of Dortmund Fab.

As required by purchase accounting rules, the Company recorded a $0.5 million step-down of inventory to its fair value as of the acquisition date based on the preliminary valuation. The step-down was fully amortized as a non-cash credit to cost of sales during the first fiscal quarter of 2025 as the acquired inventory was sold and reflected as other non-segment costs.

During the three months ended March 30, 2024, the Company incurred approximately $0.1 million of legal and professional fees related to the Dortmund Fab acquisition recognized as Selling, general, and administrative expenses in the Condensed Consolidated Statements of Net Income. Total of $3.5 million of legal and professional fees related to the Dortmund Fab acquisition was recognized since 2023. These costs were reflected as other non-segment costs.

Pro Forma Results

The following table summarizes, on an unaudited pro forma basis, the combined results of operations of the Company and Dortmund Fab as though the acquisition had occurred as of December 31, 2023. The pro forma amounts presented are not necessarily indicative of either the actual consolidated results had the Dortmund Fab acquisition occurred as of December 31, 2023, or of future consolidated operating results.


(in thousands, except per share amounts)	Three Months Ended March 29, 2025		Three Months Ended March 30, 2024
Net sales	$	554,307	$	546,901
Income before income taxes	59,406		57,125
Net income	43,192		49,446
Net income per share — basic	1.74		1.98
Net income per share — diluted	1.73		1.97

Pro forma results presented above primarily reflect the following adjustments:


(in thousands)	Three Months Ended March 29, 2025		Three Months Ended March 30, 2024
Amortization of unfavorable production contract (a)	$	—	$	756
Amortization of inventory step-down (b)	(504)		510
Depreciation			(276)
Amortization (c)			(94)
Transaction costs (d)	(37)		(469)
Income tax benefit (expense) of above items	162		(128)

(a) The amortization of the unfavorable production contract during the three months ended March 30, 2024 results from the fair value assigned to the unfavorable production contract liability that is amortized over three years.

(b) The amortization of the inventory step-down adjustment reflects the reversal of the amount recognized during the three months ended March 29, 2025, and the recognition of the amortization during the three months ended March 30, 2024. The inventory step-down was fully amortized over two months as the inventory was sold.

(c) The amortization adjustment for the three months ended March 30, 2024 primarily reflects amortization resulting from the measurement of intangibles at their fair values.

(d) The transaction costs adjustment reflects certain legal and professional fees for the three months ended March 29, 2025 and three months ended March 30, 2024, respectively.