ADT 2009 Annual Report Download - page 141

to transfer the remaining assets in China and received cash proceeds of $24 million. As a result of the
fiscal 2009 dispositions, a net pre-tax gain of $33 million was recorded in income from discontinued
operations, net of income taxes in our Consolidated Statements of Operations for the year ended
September 25, 2009.
During 2008, we sold our Empresa de Transmissao de Energia do Oeste Ltda. (‘‘ETEO’’) business,
Ancon Building Products (‘‘Ancon’’) business, Nippon Dry-Chemical Co., Ltd. (‘‘NDC’’) business, and a
European manufacturer of public address products and acoustic systems. As discussed above, we
substantially completed the sale of our Infrastructure Services Business, during the fourth quarter of
2008. These businesses met the held for sale and discontinued operations criteria and have been
included in discontinued operations in all periods presented.
In May 2008, we sold 100% of the stock of ETEO, a Brazilian subsidiary of our Infrastructure
Services business for $338 million of net cash proceeds and recorded a pre-tax gain of $232 million,
including the effects of the economic hedge of the purchase price discussed below. The gain was
recorded in income from discontinued operations, net of income taxes in our Consolidated Statements
of Operations for the year ended September 26, 2008. ETEO was part of our Corporate and Other
segment. During September 2007, we entered into an economic hedge of the Brazilian Real
denominated contractual sale price of the ETEO business. Since the hedging transaction was directly
linked to the proceeds from the sale of a business that was reflected in discontinued operations, we
began including the impact of the hedge in discontinued operations during the first quarter of 2008.
During the third quarter of 2008, we incurred a pre-tax loss of $36 million on this hedge. The impact
of the hedge in 2007 was not material.
Additionally in fiscal year 2008, we settled a contract dispute arising under our former
Infrastructure Services business. In connection with the settlement, we assessed our assets under the
original contract and concluded the assets were no longer recoverable, resulting in a $51 million charge
to discontinued operations.
During April 2008, we sold Ancon, a manufacturer of stainless steel products used in masonry
construction. Ancon was part of our Corporate and Other segment. The sale was completed for
$164 million in net cash proceeds and a pre-tax gain of $100 million was recorded which was largely
exempt from tax. The gain was recorded in income from discontinued operations, net of income taxes
in our Consolidated Statements of Operations for the year ended September 26, 2008. During the
fourth quarter of 2008, we received an additional $6 million of proceeds related to the sale of Ancon.
During February 2008, we sold NDC, a company in the Japanese fire protection industry. NDC
was part of our Fire Protection Services and Safety Products segments. The sale was completed for
$50 million in net cash proceeds and a pre-tax gain of $7 million was recorded. The gain was recorded
in income from discontinued operations, net of income taxes in our Consolidated Statements of
Operations for the year ended September 26, 2008.
During January 2008, we sold a European manufacturer of public address products and acoustic
systems, which was part of our Fire Protection Services segment and recorded an $8 million pre-tax loss
on sale. The loss was recorded in income from discontinued operations, net of income taxes in our
Consolidated Statements of Operations.
During the first quarter of 2007, Aquas Industriales de Jose, C.A. (‘‘AIJ’’), a joint venture that was
majority owned by Infrastructure Services, was sold for $42 million in net cash proceeds and a pre-tax
gain of $19 million was recorded. The gain was recorded in discontinued operations, net of income
taxes in our Consolidated Statements of Operations. AIJ was part of our Corporate and Other
segment.
2009 Financials 49