Avnet 2011 Annual Report Download - page 54

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Table of Contents
AVNET, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The Company acquired accounts receivable which were recorded at the estimated fair value amounts; however, adjustments to
acquired amounts were not significant as book value approximated fair value due to the short term nature of accounts receivables. The
gross amount of accounts receivable acquired was $381,805,000 and the fair value recorded was $363,589,000, which is expected to
be collected.
The amount of goodwill associated with the Bell acquisition that is expected to be deductible for tax purposes is not significant.
Significant synergies related to the integration of the acquired Bell business have resulted in operating cost reductions; such
expense synergy savings were a primary driver of the excess of purchase price paid over the value of assets and liabilities acquired.
Pro forma results
Unaudited pro forma financial information is presented below as if the acquisition of Bell occurred at the beginning of fiscal
2010. The pro forma information presented below does not purport to present what actual results would have been had the acquisition
in fact occurred at the beginning of fiscal 2010, nor does the information project results for any future period. In addition, the pro
forma results exclude the impact of any synergies realized as a result of integration activity.
In order to create the pro forma results in the table above, the combined results for Avnet and Bell for the twelve months ended
fiscal 2010 were adjusted for the following:
Pro forma financial information is not presented for fiscal 2011 because the Bell acquisition occurred on July 6, 2010, which is
three days after the beginning of the Company’
s fiscal year 2011. The accompanying consolidated statement of operations for the first
quarter of fiscal 2011 included sales of $781,135,000 related to the acquired Bell business. As of the end of the second quarter of
fiscal 2011, the Company was in the process of integrating the Bell business into the Avnet existing business, which included IT
systems integration, and administrative, sales and logistics operations integrations. As a result, after the first quarter of fiscal 2011, the
Company was no longer able to identify the acquired Bell business separately from the on-going Avnet business.
July 6, 2010
(Thousands)
Current assets
$
705,986
Property, plant and equipment
13,022
Goodwill
224,265
Identifiable intangible asset
60,000
Other assets
37,964
Total assets acquired
1,041,237
Current liabilities, excluding current portion of long
-
term debt
396,875
Long
-
term liabilities
30,218
Total debt
358,453
Total liabilities assumed
785,546
Net assets acquired
$
255,691
Pro Forma Results
Twelve Months Ended
July 3, 2010
(Thousands, except per
share data)
Pro forma sales
$
22,291,579
Pro forma operating income
660,769
Pro forma net income
404,249
Pro forma diluted earnings per share
$
2.64
•
$8,571,000 pre-
tax, $6,074,000 after tax, or $0.04 per diluted share for fiscal 2010 of intangible asset amortization
associated with the Bell acquisition; and
• $5,181,000 pre-
tax, $3,168,000 after tax, or $0.02 per diluted share for fiscal 2010 for Bell transaction costs that were
expensed upon closing.