Acquisitions and Dispositions

9 Months Ended

Sep. 26, 2020

Business Combinations [Abstract]

Acquisitions and Dispositions [Text Block]

Note 2.    Acquisitions and Dispositions

The company’s acquisitions have historically been made at prices above the determined fair value of the acquired identifiable net assets, resulting in goodwill, primarily due to expectations of the synergies that will be realized by combining the businesses. These synergies include the elimination of redundant facilities, functions and staffing; use of the company’s existing commercial infrastructure to expand sales of the acquired businesses’ products; and use of the commercial infrastructure of the acquired businesses to cost-effectively expand sales of company products.

Acquisitions have been accounted for using the acquisition method of accounting, and the acquired companies’ results have been included in the accompanying financial statements from their respective dates of acquisition. Acquisition transaction costs are recorded in selling, general and administrative expenses as incurred.

Terminated Acquisition

As previously announced, on March 3, 2020, the company entered into a purchase agreement to acquire all of the issued and outstanding shares of QIAGEN N.V. (“QIAGEN”). Following a determination that the number of shares tendered by QIAGEN shareholders did not meet the minimum amount required for the transaction to proceed, on August 13, 2020, the company delivered to QIAGEN a written notice terminating the purchase agreement in accordance with the terms of the agreement. In connection with the termination, QIAGEN paid to the company an expense reimbursement payment of $95 million in cash which has been recorded as a reduction of selling, general and administrative expenses.

Disposition

On June 28, 2019, the company sold its Anatomical Pathology business to PHC Holdings Corporation for $1.13 billion, net of cash divested. The business was part of the Specialty Diagnostics segment. The sale of this business resulted in a pre-tax gain of approximately $482 million in 2019, included in restructuring and other costs (income), net. Revenues in 2019, through the date of sale, of the business sold were approximately $115 million, net of retained sales through the company's healthcare market channel business.