
	BUSINESS ACQUISITIONS

On September 1, 2017, the Company completed the acquisition of Chiltern International Group Limited (Chiltern), a specialty contract research organization, pursuant to a definitive agreement to acquire all of the share capital of Chiltern, in an all-cash transaction valued at approximately $1,224.5. The Company funded the acquisition through a combination of bank financing and the issuance of bonds. Chiltern is part of the Company's CDD segment.

The valuation of acquired assets and assumed liabilities as of September 1, 2017, include the following:



Consideration Transferred
Cash consideration	$	1,224.5
	$	1,224.5

	Preliminary
Net Assets Acquired
Cash and cash equivalents	$	30.7
Accounts receivable	116.9
Unbilled services	32.6
Prepaid expenses and other	57.9
Property, plant and equipment	12.1
Goodwill	676.6
Customer relationships	629.0
Trade names and trademarks	24.1
Technology	47.0
Total assets acquired	1,626.9
Accounts payable	18.1
Accrued expenses and other	51.0
Unearned revenue	124.2
Deferred income taxes	208.0
Other liabilities	1.1
Total liabilities acquired	402.4
Net assets acquired	$	1,224.5

The amortization periods for intangible assets acquired are 21 years for customer relationships, 7 years for trade names and trademarks, and 9 years for technology.

The Chiltern acquisition contributed $47.8 and $5.3 of revenue and operating income, respectively, during the three and nine months ended September 30, 2017.

Unaudited Pro Forma Information

The Company completed the Chiltern acquisition on September 1, 2017. Had the Chiltern acquisition been completed as of January 1, 2016, the Company's pro forma results for 2017 would have been as follows:



	Three Months Ended September 30, 2017		Three Months Ended September 30, 2016		Nine Months Ended September 30, 2017		Nine Months Ended September 30, 2016
Net revenues	$	2,696.8	$	2,495.5	$	7,874.8	$	7,422.0
Operating income	342.5		322.3		1,022.8		998.4
Net income	176.8		171.9		551.5		534.2
Earnings per share:
Basic	$	1.73	$	1.67	$	5.39	$	5.21
Diluted	$	1.70	$	1.63	$	5.31	$	5.11

The unaudited pro forma results reflect certain adjustments related to past operating performance and acquisition accounting adjustments, such as increased amortization expense and decreased depreciation expense based on the estimated fair value of assets acquired, the impact of the Company’s new financing arrangements, and the related tax effects. The pro forma results do not include any anticipated synergies which may be achievable subsequent to the Chiltern acquisition. To produce the unaudited pro forma financial information, the Company adjusted Chiltern’s assets and liabilities to their estimated fair value based on a valuation as of September 1, 2017. These pro forma results of operations have been prepared for comparative purposes only, and they do not purport to be indicative of the results of operations that actually would have resulted had the acquisition of Chiltern occurred on the date indicated or that may result in the future.

During the nine months ended September 30, 2017, the Company also acquired various laboratories, including Pathology Associates Medical Laboratories (PAML), and related assets for approximately $605.5 in cash (net of cash acquired). The purchase consideration for all acquisitions year to date, including Chiltern, has been allocated to the estimated fair market value of the net assets acquired, including approximately $1,103.0 in identifiable intangible assets (primarily customer relationships, technology and non-compete agreements) and a residual amount of goodwill of approximately $817.2. These acquisitions were made primarily to extend the Company's geographic reach in important market areas and/or enhance the Company's scientific differentiation and esoteric testing capabilities.

With the acquisition of PAML, the Company assumed PAML’s ownership interests in five joint ventures. The Company's acquisition of PAML represents the first step in completing the transaction. During the remainder of 2017 and into 2018, the Company will acquire the ownership interests in three of the joint ventures and will continue to evaluate future options for their interests in the remaining joint venture. As the Company continues the progression to close various components of this transaction, minority interest will be recorded for the portion of the consolidated joint ventures not yet closed. The purchase consideration for the transaction has been preliminarily allocated to the estimated fair market value of the net assets acquired. The amounts paid in advance for the ownership interest in the three joint ventures are included in other assets on the condensed consolidated balance sheet. The total purchase consideration for the transaction, inclusive of the amounts for the future acquisition of the ownership interests in the four joint ventures, is classified as cash paid for acquisition of a business on the condensed consolidated statement of cash flows.

The purchase price allocation for the Chiltern and PAML acquisitions are still preliminary and subject to change. The areas of the purchase price allocation that are not yet finalized relate primarily to intangible assets, goodwill, investment in joint ventures and the impact of finalizing deferred taxes. Accordingly, adjustments may be made as additional information is obtained about the facts and circumstances that existed as of the valuation date. The Company expects these purchase price allocations to be finalized within a year from each acquisition date. Any adjustments will be recorded in the period in which they are identified.