Cardinal Health 2008 Annual Report Download - page 113

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9. GOODWILL AND OTHER INTANGIBLE ASSETS
The Company accounts for purchased goodwill and other intangible assets in accordance with
SFAS No. 142. The following table summarizes the changes in the carrying amount of goodwill, in total and by
segment for the two years ended June 30, 2008:
(in millions)
Healthcare
Supply Chain
Services-
Pharmaceutical
Healthcare
Supply Chain
Services- Medical
Clinical
Technologies
and Services
Medical
Products and
Technologies Total
Balance at June 30, 2006 .................. $1,248.6 $373.5 $1,710.7 $ 424.1 $3,756.9
Goodwill acquired, net of purchase price
adjustments, foreign currency translation
adjustments and other (1)(2)(3) ........... (25.3) 5.8 96.0 1,032.7 1,109.2
Transfer (4) ............................ — 2.7 — (2.7) —
Balance at June 30, 2007 .................. $1,223.3 $382.0 $1,806.7 $1,454.1 $4,866.1
Goodwill acquired, net of purchase price
adjustments, foreign currency translation
adjustments and other (5)(6)(7)(8) ......... 13.4 7.8 11.8 275.8 308.8
Goodwill related to the divestiture or closure of
businesses and assets held for sale (9) ...... — — — (43.2) (43.2)
Balance at June 30, 2008 .................. $1,236.7 $389.8 $1,818.5 $1,686.7 $5,131.7
(1) The decrease within the Healthcare Supply Chain Services—Pharmaceuticals segment primarily related to
Dohmen purchase accounting adjustments offset by the acquisition of SpecialtyScripts, LLC
(“SpecialtyScripts”), which resulted in a preliminary goodwill allocation of $6.9 million. The SpecialtyScripts
acquisition also included a potential maximum future contingent payment of $41.0 million.
(2) The increase within the Clinical Technologies and Services segment primarily related to the acquisition of
MedMined, Inc. (“MedMined”) and Care Fusion, which resulted in a preliminary goodwill allocation of
$66.1 million and $44.2 million, respectively. The MedMined acquisition also included a potential
maximum future contingent payment of $10.5 million.
(3) The increase within the Medical Products and Technologies segment primarily related to the acquisition of
Viasys resulting in a preliminary goodwill allocation of $1.0 billion, which was offset by Denver
Biomedical, Inc. purchase accounting adjustments of $16.7 million.
(4) At the end of fiscal 2006, the Company divided the businesses previously reported within the Medical
Products and Services segment into the Healthcare Supply Chain Services—Medical and Medical Products
and Technologies segments to better align business operations. The transfer is an adjustment to the goodwill
initially allocated between these new segments.
(5) The increase within the Healthcare Supply Chain Services—Pharmaceutical segment primarily related to
adjustments to minor acquisitions of $15.0 million, deferred tax adjustments and foreign currency
translation adjustments.
(6) The increase within the Healthcare Supply Chain Services—Medical segment primarily related to a minor
acquisition which resulted in a preliminary goodwill allocation of $5.5 million. The remaining amounts
represent foreign currency translation adjustments.
(7) The increase within the Clinical Technologies and Services segment primarily related to adjustments to
minor acquisitions of $19.6 million, partially offset by a deferred tax adjustment related to the Alaris
acquisition of $5.7 million.
(8) The increase within the Medical Products and Technologies segment primarily related to the acquisition of
Enturia which resulted in a preliminary goodwill allocation of $327.8 million and an adjustment to
in-process research and development related to the Viasys acquisition of $25.0 million which was partially
offset by a reclassification from goodwill to identified intangible assets for the final Viasys acquisition
valuation of $81.5 million.
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