Energizer 2011 Annual Report Download - page 67

ENERGIZER HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in millions, except per share and percentage data)
On September 15, 2011, the FASB issued a new ASU to Testing Goodwill for Impairment. The new guidance provides an
option to perform a "qualitative" assessment to determine whether further impairment testing is necessary. This guidance will
be applied on a prospective basis beginning on January 1, 2012.
(3) American Safety Razor acquisition
On November 23, 2010, we completed the acquisition of ASR, as we acquired substantially all of the assets of ASR, including
the assets of its U.S. subsidiaries and the stock of its non-U.S. subsidiaries, and assumed substantially all of the liabilities of
ASR and its U.S. subsidiaries, for a cash purchase price of $301. The Company financed this transaction with available cash of
approximately $129 and borrowings from our existing receivable securitization program. ASR is part of our Personal Care
Segment. ASR provides an important strategic fit and opportunity for the Personal Care business as it competes in the value
segment of the wet shave category. The Company’s legacy Wet Shave product line focuses on branded wet shave products.
ASR, founded in 1875, is a leading global manufacturer of private label/value wet shaving razors and blades, and industrial and
specialty blades.
As of September 30, 2011, the purchase price allocation for the ASR acquisition is complete. We have determined the fair
values of assets acquired and liabilities assumed for purposes of allocating the purchase price, in accordance with accounting
guidance for business combinations. For purposes of the allocation, the Company has estimated a fair value adjustment for
inventory based on the estimated selling price of the finished goods acquired at the closing date less the sum of (a) costs of
disposal and (b) a reasonable profit allowance for the selling effort of the acquiring entity. The fair value adjustment for the
acquired equipment was established using a cost and market approach. The fair values of the identifiable intangible assets were
estimated using various valuation methods including discounted cash flows using both an income and cost approach. In
accordance with fair value measurement guidance, the Company determined that the non-financial assets and liabilities
summarized below are derived from significant unobservable inputs (“Level 3 inputs”).
At September 30, 2011, the allocation of the purchase price is as follows:
Cash
Trade receivables, net
Inventories
Identifiable intangible assets
Goodwill
Other assets
Property, plant and equipment, net
Accounts payable and other liabilities
Income taxes payable
Pension/Other Postretirement Benefits
Net assets acquired
$ 33.9
52.4
45.8
122.3
161.9
51.9
117.1
(101.2)
(60.5)
(122.6)
$ 301.0
The purchased identifiable intangible assets are as follows:
Customer Relationships
Technology and patents
Tradenames / Brands
Total
Total
$ 94.4
20.4
7.5
$ 122.3
Estimated Life
20 years
7 years
15 years
For tax purposes, Goodwill will be amortized over 15 years.
Proforma revenue and operating results for ASR are not included as they are not considered material to the Consolidated
Financial Statements.
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