Cardinal Health 2009 Annual Report Download - page 97

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In June 2009, the FASB issued SFAS No. 167, “Amendments to FASB Interpretation No. 46(R).” This
Statement improves the financial reporting by enterprises involved with variable interest entities. This Statement
is effective for fiscal years beginning after November 15, 2009. The Company is in the process of determining
the impact of adopting this Statement.
2. ACQUISITIONS
Fiscal 2009. During fiscal 2009 the Company completed an acquisition that individually was not significant.
The aggregate purchase price of this acquisition, which was paid in cash, was approximately $128.7 million with
potential maximum contingent payments of $14.0 million. Assumed liabilities of this acquired business was
approximately $102.1 million. The consolidated financial statements include the results of operations from this
business combination from the date of acquisition. Had the transaction occurred at the beginning of fiscal 2008,
consolidated results of operations would not have differed materially from reported results.
Fiscal 2008. On May 12, 2008, the Company completed the acquisition of assets of privately held Enturia
Inc. (“Enturia”), a Leawood, Kansas-based manufacturer of products and services directed at the infection
prevention markets. The purchase price of the acquisition, which was paid in cash, was approximately $490.0
million, including the assumption of approximately $14.2 million of liabilities, which included $5.1 million of
debt.
The preliminary valuation of the acquired assets and liabilities resulted in goodwill of approximately $327.8
million and identifiable intangible assets of $129.4 million. The final valuation was completed in fiscal 2009 and
the Company identified and valued intangible assets related to trade names and trademarks, developed
technology and customer relationships. The detail by category is as follows.
Category
Amount
(in millions)
Average
Life (Years)
Trade names and trademarks ..................................... $ 19.1 10
Developed technology .......................................... 25.3 10
Customer relationships .......................................... 85.0 10
Total identifiable intangible assets ................................. $129.4
During fiscal 2008, the Company recorded a charge of $17.7 million related to the write-off of estimated
IPR&D costs associated with the Enturia acquisition. The portion of the purchase price allocated to IPR&D in
fiscal 2008 represented the Company’s preliminary estimate of the fair value of the research and development
projects in-process at the time of the acquisition. These projects had not yet reached technological feasibility,
were deemed to have no alternative use and, accordingly, were immediately charged to special items expense at
the acquisition date in accordance with FIN No. 4, “Applicability of FASB Statement No. 2 to Business
Combinations Accounted for by the Purchase Method.”
In addition, during fiscal 2008 the Company completed other acquisitions that individually were not
significant. The aggregate purchase price of these acquisitions, which was paid in cash, was approximately $35.3
million with potential maximum contingent payments of $85.0 million. Assumed liabilities of these acquired
businesses was approximately $5.6 million. The consolidated financial statements include the results of
operations from each of these business combinations from the date of acquisition. Had the transactions occurred
at the beginning of fiscal 2007, consolidated results of operations would not have differed materially from
reported results.
Fiscal 2007. On June 21 and 27, 2007, the Company completed the initial and subsequent tender offers for
the outstanding common stock of Viasys, a Conshohocken, Pennsylvania-based provider of products and services
75