Divestiture-Related Activities

12 Months Ended

Dec. 31, 2013

Divestiture-Related Activities

Note 18 — Divestiture-related activities

Assets Held for Sale

The table below provides information regarding assets held for sale at December 31, 2013 and 2012. At December 31, 2013, these assets consisted of four buildings and other assets, which the Company is actively marketing.

	2013		2012
Assets held for sale:	(Dollars in thousands)
Property, plant and equipment	$	10,428	$	7,963
Total assets held for sale	$	10,428	$	7,963

Discontinued Operations

The Company has recorded $2.2 million, $2.7 million and $17.1 million of expense during 2013, 2012 and 2011, respectively, associated with retained liabilities related to businesses that have been divested. Of the $17.1 million recorded in 2011, $7.5 million was associated with recall costs related to defective products, which was a subject of pending litigation related to the Company’s former Commercial Segment. During the third quarter 2011, the Company settled the litigation as it related to the recall costs and, as part of the settlement, paid $7.6 million in September 2011.

On August 26, 2012, the Company completed the sale of the orthopedic business of its OEM Segment to Tecomet for $45.2 million in cash and realized a loss of $39 thousand, net of tax, from the sale of the business.

On December 2, 2011, the Company completed the sale of its business units that design, engineer and manufacture air cargo systems and air cargo containers and pallets to a subsidiary of AAR CORP. for $280.0 million in cash and realized a gain of $126.8 million, net of tax, from the sale. In 2012, the Company received an additional $16.8 million in proceeds as a working capital adjustment pursuant to the terms of the agreement related to the sale of the business, which resulted in recognition of an additional gain on sale of $2.2 million, net of tax. These business units represented the sole remaining businesses in the Company’s former Aerospace Segment.

On March 22, 2011, the Company completed the sale of its marine business to an affiliate of H.I.G. Capital, LLC for consideration of $123.1 million (consisting of $103.1 million in cash, plus a subordinated promissory note in the amount of $4.5 million and the assumption by the buyer of approximately $15.5 million in liabilities related to the marine business). Net assets transferred to the buyer in the sale included $1.5 million of cash, resulting in net cash proceeds to the Company of $101.6 million. The Company realized a gain of $57.3 million, net of tax benefits, from the sale of the business. The gain reflected the net effect of accumulated losses from pension and postretirement obligations realized by the Company of approximately $8.4 million and cumulative translation gains realized by the Company of approximately $33.4 million, resulting in a net change of approximately $25.0 million in accumulated other comprehensive income. In 2012, the $4.5 million subordinated promissory note plus related accrued interest of $0.7 million was paid by the buyer. The marine business consisted of the Company’s businesses that were engaged in the design, manufacture and distribution of steering and throttle controls and engine and drive assemblies for the recreational marine market, heaters for commercial vehicles and burner units for military field feeding appliances. The marine business represented the sole remaining business in the Company’s former Commercial Segment.

The results of the Company’s discontinued operations for the years 2013, 2012 and 2011 were as follows:

	2013			2012			2011
	(Dollars in thousands)
Net revenues	$	—		$	16,616		$	277,972
Costs and other expenses		2,205			18,328			255,919
Goodwill impairment(1)		—			9,700			—
Gain on disposition(2)		—			2,205			270,630
Income (loss) from discontinued operations before income taxes		(2,205	)		(9,207	)		292,683
Taxes (benefit) on income (loss) from discontinued operations		(1,770	)		(1,887	)		87,038
Income (loss) from discontinued operations		(435	)		(7,320	)		205,645
Less: Income from discontinued operations attributable to noncontrolling interest		—			—			617
Income (loss) from discontinued operations attributable to common shareholders	$	(435	)	$	(7,320	)	$	205,028

(1) During 2012, the Company recognized a non-cash goodwill impairment charge of $9.7 million to adjust the carrying value of the orthopedic business to its estimated fair value.

(2) The $2.2 million pre-tax gain on disposition during 2012 primarily reflects the gain recognized on the working capital adjustment related to the sale of the cargo systems and cargo container businesses.