Dow Chemical 2011 Annual Report Download - page 184

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The following table summarizes the fair values of the assets acquired and liabilities assumed from Rohm and Haas on
April 1, 2009. During the measurement period, which ended on March 31, 2010, net adjustments of $145 million were made to
the fair values of the assets acquired and liabilities assumed with a corresponding adjustment to goodwill. These adjustments
are summarized in the table presented below. No further adjustments were made to the acquisition-date fair values of assets
acquired and liabilities assumed after the end of the measurement period.
Assets Acquired and Liabilities Assumed
on April 1, 2009
In millions
Purchase Price
Fair Value of Assets Acquired
Current assets
Property
Other intangible assets
Other assets
Net assets of the Salt business (1)
Total Assets Acquired
Fair Value of Liabilities and Noncontrolling
Interests Assumed
Current liabilities
Long-term debt
Accrued and other liabilities and
noncontrolling interests
Pension benefits
Deferred tax liabilities – noncurrent
Total Liabilities and Noncontrolling
Interests Assumed
Goodwill
Initial
Valuation
$ 15,681
$ 2,710
3,930
4,475
1,288
1,475
$ 13,878
$ 1,218
2,528
702
1,119
2,482
$ 8,049
$ 9,852
2009
Adjustments
to Fair
Value
$ —
$ —
(138)
830
32
(167)
$ 557
$ (11)
13
—
—
311
$ 313
$ (244)
At
Dec 31,
2009
$ 15,681
$ 2,710
3,792
5,305
1,320
1,308
$ 14,435
$ 1,207
2,541
702
1,119
2,793
$ 8,362
$ 9,608
2010
Adjustments
to Fair
Value
$ —
$ (18)
—
—
—
—
$ (18)
$ (1)
—
—
—
82
$ 81
$ 99
At
March 31,
2010
$ 15,681
$ 2,692
3,792
5,305
1,320
1,308
$ 14,417
$ 1,206
2,541
702
1,119
2,875
$ 8,443
$ 9,707
(1) Morton International, Inc.
The fair value of receivables acquired from Rohm and Haas on April 1, 2009 (net of the Salt business) was $1,001 million,
with gross contractual amounts receivable of $1,048 million. Liabilities assumed from Rohm and Haas on April 1, 2009
included certain contingent environmental liabilities valued at $159 million and a liability of $185 million related to Rohm and
Haas Pension Plan matters (see Note N), which were valued in accordance with the accounting guidance for contingencies.
Operating loss carryforwards of $2,189 million were acquired from Rohm and Haas on April 1, 2009, $137 million of which
were subject to expiration in 2009 through 2013.
The following table summarizes the major classes of assets and liabilities underlying the deferred tax liabilities resulting
from the acquisition of Rohm and Haas:
Deferred Tax Liabilities Assumed on April 1, 2009
In millions
Intangible assets
Property
Long-term debt
Inventory
Other accruals and reserves
Total Deferred Tax Liabilities
As Adjusted
$ 1,754
526
191
80
324
$ 2,875
The acquisition resulted in the recognition of $9,707 million of goodwill, which is not deductible for tax purposes. See
Note I for further information on goodwill.
Goodwill largely consists of expected synergies resulting from the acquisition. Key areas of cost savings include increased
purchasing power for raw materials; manufacturing and supply chain work process improvements; and the elimination of
redundant corporate overhead for shared services and governance. The Company also anticipates that the transaction will